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Well, if energy is locally cheap but difficult to export, it's not surprising that somebody tries to find a use for it, and really not that surprising that it's

Well, if energy is locally cheap but difficult to export, it's not surprising that somebody tries to find a use for it, and really not that surprising that it's being used for computations. But since mining bitcoins is sort of a zero sum game, it might be better if the energy were used for some computation that actually added value to the world, if such a thing exists.

eru 3y ago
Mining bitcoin is also a zero sum, if other miners aren't allowed to leave the business. If someone in place A with cheap, stranded power enters the mining business, the difficulty of bitcoin mining will increase, and perhaps enough to convince a miner in place B to exit, and thus free up some energy there to use in another productive endeavour. Be that for computation or for a different use. In this sense bitcoin mining acts a bit like a pneumatic system to 'move power around' in a virtual sense. I specifically use pneumatic as the analogy, and not hydraulic, because hydraulic fluids are incompressible.
- mtoner23 3y ago
  That's not how energy markets work
  - eru 3y ago
    Please explain what you mean. My example assumed for the sake of simplicity that people starting bitcoin mining in A would drive up hash rate and thus difficulty enough to make mining unprofitable on the margin in some place B. The electricity used for mining in B before can now either be used for something else, or the people in B can produce less electricity and save on resources.
    - Moneyyyyy 3y ago
      People want to have as much BTC as possible. Which means Bitcoin mining is a virus searching and consuming as much cheap energy as possible. We are not at a point we're the margin is so small that we see consumption/mining shifting. We only see consumption and more consumption. And of course this totally decentivie making the energy usable through things like high voltage DC lines or metal smelting or even making hydrogen.
      - eru 3y ago
        Huh? Of course, we see such shifting. Eg it used to be profitable to mine on your PC. Those days are long past: the returns don't cover the cost of electricity. Hence a shift away from that. See https://digiconomist.net/bitcoin-energy-consumption https://digiconomist.net/bitcoin-energy-consumption for an estimate of bitcoin power usage. It's going down as well as up.

eru 3y ago

Mining bitcoin is also a zero sum, if other miners aren't allowed to leave the business. If someone in place A with cheap, stranded power enters the mining business, the difficulty of bitcoin mining will increase, and perhaps enough to convince a miner in place B to exit, and thus free up some energy there to use in another productive endeavour. Be that for computation or for a different use. In this sense bitcoin mining acts a bit like a pneumatic system to 'move power around' in a virtual sense. I specifically use pneumatic as the analogy, and not hydraulic, because hydraulic fluids are incompressible.

mtoner23 3y ago
That's not how energy markets work
- eru 3y ago
  Please explain what you mean. My example assumed for the sake of simplicity that people starting bitcoin mining in A would drive up hash rate and thus difficulty enough to make mining unprofitable on the margin in some place B. The electricity used for mining in B before can now either be used for something else, or the people in B can produce less electricity and save on resources.
  - Moneyyyyy 3y ago
    People want to have as much BTC as possible. Which means Bitcoin mining is a virus searching and consuming as much cheap energy as possible. We are not at a point we're the margin is so small that we see consumption/mining shifting. We only see consumption and more consumption. And of course this totally decentivie making the energy usable through things like high voltage DC lines or metal smelting or even making hydrogen.
    - eru 3y ago
      Huh? Of course, we see such shifting. Eg it used to be profitable to mine on your PC. Those days are long past: the returns don't cover the cost of electricity. Hence a shift away from that. See https://digiconomist.net/bitcoin-energy-consumption https://digiconomist.net/bitcoin-energy-consumption for an estimate of bitcoin power usage. It's going down as well as up.