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Yeah, my understanding is that miners are not just mining, they're also powering the distributed transaction engine of bitcoin. Is that correct? In which case t

Yeah, my understanding is that miners are not just mining, they're also powering the distributed transaction engine of bitcoin. Is that correct? In which case the power consumption needs to be compared to (per $ or whatever) consumption for Bacs, swift, visa etc

jacquesm 14y ago
The proper measure would be Joules/transaction.
sigil 14y ago
Correct. It's quite ingenious actually. "By convention, the first transaction in a block is a special transaction that starts a new coin owned by the creator of the block. This adds an incentive for nodes to support the network, and provides a way to initially distribute coins into circulation, since there is no central authority to issue them." http://bitcoin.org/bitcoin.pdf http://bitcoin.org/bitcoin.pdf
- codeulike 14y ago
  But how does that work when the generation of new coins tails off, but the generation of new blocks does not?
  - sigil 14y ago
    Good question. Longer transaction blocks maybe? Would love to hear this answered.
    - codeulike 14y ago
      From whats said here https://news.ycombinator.com/item?id=5548503 https://news.ycombinator.com/item?id=5548503 miners grant themselves a fraction of a bitcoin for each block, and that fraction is what decreases over time.
  - sehugg 14y ago
    Each block also awards the miner a variable fee for every transaction included in that block, so there will always be an incentive to mine: https://en.bitcoin.it/wiki/FAQ#If_no_more_coins_are_going_to_be_generated.2C_will_more_blocks_be_created.3F https://en.bitcoin.it/wiki/FAQ#If_no_more_coins_are_going_to...
paulhodge 14y ago
They are doing a make-work exercise which only needs to be time consuming, in order to prevent cheaters. It's mostly throw-away work. The actual computation that needs to happen is pretty trivial. I think it would be possible to fix Bitcoin so that "proof of work" is something that doesn't consume all that electricity, but I'm not sure what it would be.
- mayank 14y ago
  If it doesn't consume electricity at a high rate, it's not proof of work, ie there's nothing to "fix".
  - wmf 14y ago
    Since it's memory-intensive, scrypt might be a more energy-efficient form of proof of work than SHA.
    - Freaky 14y ago
      Already being used: http://litecoin.org/ http://litecoin.org/ Only more efficient in that nobody's throwing lots of chunky GPUs at it.
      - wmf 14y ago
        Does a GPU use less power while mining Litecoin? It seems like the cores would be 99% idle.
        corysama 14y ago
        Nope. The GPUs get plenty hot. The difference is that with Litecoin, your CPU gets hot too! I have not dug into the technical details, but at a glance it looks as if Litecoin motivated research that fairly successfully overcame the GPU-unfriendliness of Scrypt. If anyone here can confirm or deny this, I'd love to hear it.
Andrew_Quentin 14y ago
Wouldn't - if bitcoins was to become mainstream - wouldn't there be a need for bitcoin debit or credit cards though and atms and banks. So realistically we are only limited to comparing it to actual transaction costs.

jacquesm 14y ago

The proper measure would be Joules/transaction.

sigil 14y ago

Correct. It's quite ingenious actually. "By convention, the first transaction in a block is a special transaction that starts a new coin owned by the creator of the block. This adds an incentive for nodes to support the network, and provides a way to initially distribute coins into circulation, since there is no central authority to issue them." http://bitcoin.org/bitcoin.pdf http://bitcoin.org/bitcoin.pdf

codeulike 14y ago
But how does that work when the generation of new coins tails off, but the generation of new blocks does not?
- sigil 14y ago
  Good question. Longer transaction blocks maybe? Would love to hear this answered.
  - codeulike 14y ago
    From whats said here https://news.ycombinator.com/item?id=5548503 https://news.ycombinator.com/item?id=5548503 miners grant themselves a fraction of a bitcoin for each block, and that fraction is what decreases over time.
- sehugg 14y ago
  Each block also awards the miner a variable fee for every transaction included in that block, so there will always be an incentive to mine: https://en.bitcoin.it/wiki/FAQ#If_no_more_coins_are_going_to_be_generated.2C_will_more_blocks_be_created.3F https://en.bitcoin.it/wiki/FAQ#If_no_more_coins_are_going_to...

paulhodge 14y ago

They are doing a make-work exercise which only needs to be time consuming, in order to prevent cheaters. It's mostly throw-away work. The actual computation that needs to happen is pretty trivial. I think it would be possible to fix Bitcoin so that "proof of work" is something that doesn't consume all that electricity, but I'm not sure what it would be.

mayank 14y ago
If it doesn't consume electricity at a high rate, it's not proof of work, ie there's nothing to "fix".
- wmf 14y ago
  Since it's memory-intensive, scrypt might be a more energy-efficient form of proof of work than SHA.
  - Freaky 14y ago
    Already being used: http://litecoin.org/ http://litecoin.org/ Only more efficient in that nobody's throwing lots of chunky GPUs at it.
    - wmf 14y ago
      Does a GPU use less power while mining Litecoin? It seems like the cores would be 99% idle.
      - corysama 14y ago
        Nope. The GPUs get plenty hot. The difference is that with Litecoin, your CPU gets hot too! I have not dug into the technical details, but at a glance it looks as if Litecoin motivated research that fairly successfully overcame the GPU-unfriendliness of Scrypt. If anyone here can confirm or deny this, I'd love to hear it.

Andrew_Quentin 14y ago

Wouldn't - if bitcoins was to become mainstream - wouldn't there be a need for bitcoin debit or credit cards though and atms and banks. So realistically we are only limited to comparing it to actual transaction costs.