6 ms·

It's worse than that. To me, the biggest flaw of bitcoin is that you have to constantly spend energy on it (as in computation power / burn coal) for it to remai

by TheDong 12y ago

It's worse than that. To me, the biggest flaw of bitcoin is that you have to constantly spend energy on it (as in computation power / burn coal) for it to remain viable. As soon as enough people get tired of throwing away money at their miners someone can pull a 51% attack, so everyone must put more energy into their miners to protect their investment... forever. Over time the amount of energy wasted by bitcoin could become stupendously dumb. We could be using our spare processor cycles to fold proteins or aid in numerous other research, and yet we're using it to allow people to send bits of data to each other without a need for centralized trust. Compare that to the centralized bank where you have a single centralized trusted source which allows transferring money from one person to another to take no more energy than a modest server and some backups -- far less than the power consumption of a single GPU miner. The above problem also won't get better. Even after you're no longer mining for new coins, you must keep up the mining volume to protect existing coins and allow transactions to occur at all. I personally find the above to be a fundamental problem with the "proof of work" solution. Sure, on paper you've solved the General's problem, but the reality is that you're throwing massive amounts of energy out the window. Because of that, I think this proof's place should have been to remain on paper.

brazzy 12y ago
Do you have any idea how much energy, work and time is being spent on the infrastructure of regular currencies? Minting, ATMs, secure transport, brank branches, all kind of mainframe dinosaurs running 40 year old COBOL code? Even if scaled up to global usage, I very much doubt Bitcoin mining would be worse.
- throwawayaway 12y ago
  https://blockchain.info/charts/hash-rate https://blockchain.info/charts/hash-rate the hash rate doesn't grow on trees. why the hell would you doubt it would be worse? it does 7 transactions per second. http://www.forbes.com/sites/timworstall/2013/12/03/fascinating-number-bitcoin-mining-uses-15-millions-worth-of-electricity-every-day/ http://www.forbes.com/sites/timworstall/2013/12/03/fascinati... here's on estimate: Bitcoin Mining Uses $15 Million's Worth Of Electricity Every Day
  - brazzy 12y ago
    Mining effort is pretty much independant of the number of transactions.
    - deleted 12y ago
      [deleted]
  - mr_luc 12y ago
    Did you read that article you posted? Those stats assumed CPU/GPU and FPGA, not ASIC, miners. For instance, the 5-to-500-gigahash-per-second rigs would have to be running at over 300k watts of electricity using those statistics. :) So in reality, the network is much more efficient -- the high-end miners are using more than 100x less electricity (which would still be 3000 watts for high-end rigs per those numbers), and probably closer to 1000x less, than those estimates.
    - throwawayaway 12y ago
      current hash rate GH/s: 300,000,000 //https://blockchain.info/charts/hash-rate https://blockchain.info/charts/hash-rate GH/s/w: 4.6 // http://www.coindesk.com/a-look-inside-kncminer/ http://www.coindesk.com/a-look-inside-kncminer/ watts to provite current hash rate: 300,000,000/4.6 = 65,217,391.30 w kw to provide 1s: 65,217.39 an hour of that: 65,217.39*3600 234,782,604 kwh 10c per kwh => $23,478,260.4 per hour 24 hours => $563,478,249.60 my own figures are even more wacky so I would welcome some better statistics.
      - brazzy 12y ago
        Your calculation is WAY off, which the bizarrely high end result should have made obvious. Multiplying by 3600 is where you go wrong. 65,217kW is the energy usage. Providing that for an hour takes 65,217kWh - not multiplied by anything. So that's $6,521 per hour, $156,521 per day.
        throwawayaway 12y ago
- TheDong 12y ago
  Yes, bitcoin mining would be worse. Provably worse. As computers get better, traditional applications, like databases, perform better and you can either serve more customers, use cheaper (and often more efficient hardware), or do nothing and use your outdated hardware. With bitcoin, your enemy is not the performance of the raw work you are doing (you can hash better), but the fact that everyone else also has these increases. Because of that, the limiting factor is not performance, but cost, and so over time the average cost of the bitcoin network will not go down like the cost of centralized systems do. Let's do a thought experiment: Let's imagine that instantly all computers get 100 times faster but it costs 10 times the energy to run these faster machines (not actually that unrealistic) and the cost becomes 10 times cheaper. Traditional centralized banks can simply use a 10th of their existing hardware to have no energy-cost increase but a 10 times increase in customers they can serve. Sure, it's a bureaucracy, so it'll roll out slowly, but they're saving money too so maybe a little faster. Bitcoin, everyone will simply buy 10 times as much hardware since it's cheaper and they want to get a bigger bit of the pie (mining reward) before everyone else manages to buy all their hardware. You now have an equilibrium in terms of equipment cost reached again, but suddenly the hash-rate is 1000 times more and the energy consumption is 100 times more. The above might sound a little too theoretical, but if you look at the increase in hash rate and estimates for power usage of cpus, then gpus, and then asics, you'll see that in general power consumption for bitcoin constantly increases. You're arguing that the existing cost of banks / the existing system is high because it's legacy. Your argument doesn't say "and it's constantly, and provably, going to waste more energy as hardware gets more cost-efficient". Even if you want to claim that banks are currently less efficient (which I doubt they are), I hope the above convinces you that bitcoin over time will constantly use more energy thus resulting in an obviously more wasteful result, while banks and other centralized systems can take advantage of improvements and thus become more cost and power efficient over time.
  - zamalek 12y ago
    > Yes, bitcoin mining would be worse. Provably worse. ... and exponentially worse as time goes on (by design).
    - 12y ago
- skrause 12y ago
  Minting, ATMs, secure transport, CC transactions are all things that can be optimized for lower energy if necessary. Bitcoin mining will always be a race on who can spend the most energy.
  - moe 12y ago
    Bitcoin mining will always be a race on who can spend the most energy. No. It is a race on who can spend their energy the most efficiently. (in terms of hashes per kWh). That's why old mining methods (CPU miner, GPU miner...) are obsoleted by new ones (ASICs). You can pump a Gigawatt into an old GPU mining rig and it will only cost you a lot of money. Pump the same Gigawatt into a modern ASIC rig and it might make you money.
davidw 12y ago
> Because of that, I think this proof's place should have been to remain on paper. I'm not really a fan of bitcoin, and wouldn't touch it myself, but I think it's an interesting experiment.
spiritplumber 12y ago
I'd like something like Foldcoin where your proof-of-work is actually doing something beside keeping my home warm inefficiently.
- synchronise 12y ago
  I personally like the idea of Gridcoin more, because BOINC lets you use your processing power for other things than just folding proteins (although with Rosetta you can still do that) like searching for aliens or looking for gravitational anomalies.
  - spiritplumber 12y ago
    Thanks, I didn't know that existed. Nice!
- CyberDildonics 12y ago
  So buy some.
olalonde 12y ago
Proof of Stake is a proposed solution to that criticism https://en.bitcoin.it/wiki/Proof_of_Stake https://en.bitcoin.it/wiki/Proof_of_Stake (although not free of criticism itself).
Normati 12y ago
The time to make these complaints was years ago, possibly on the way up a big boom just to show that you're confident in yourself despite the apparent evidence to the contrary. Now that it's going down doesn't mean it was caused by people realizing it wastes power, doesn't scale or doesn't pay interest. These are age old criticisms that haven't stopped the price from still being 10 times higher than it was when I first heard about bitcoins.

by TheDong 12y ago

brazzy 12y ago

Do you have any idea how much energy, work and time is being spent on the infrastructure of regular currencies? Minting, ATMs, secure transport, brank branches, all kind of mainframe dinosaurs running 40 year old COBOL code? Even if scaled up to global usage, I very much doubt Bitcoin mining would be worse.

throwawayaway 12y ago
https://blockchain.info/charts/hash-rate https://blockchain.info/charts/hash-rate the hash rate doesn't grow on trees. why the hell would you doubt it would be worse? it does 7 transactions per second. http://www.forbes.com/sites/timworstall/2013/12/03/fascinating-number-bitcoin-mining-uses-15-millions-worth-of-electricity-every-day/ http://www.forbes.com/sites/timworstall/2013/12/03/fascinati... here's on estimate: Bitcoin Mining Uses $15 Million's Worth Of Electricity Every Day
- brazzy 12y ago
  Mining effort is pretty much independant of the number of transactions.
  - deleted 12y ago
    [deleted]
- mr_luc 12y ago
  Did you read that article you posted? Those stats assumed CPU/GPU and FPGA, not ASIC, miners. For instance, the 5-to-500-gigahash-per-second rigs would have to be running at over 300k watts of electricity using those statistics. :) So in reality, the network is much more efficient -- the high-end miners are using more than 100x less electricity (which would still be 3000 watts for high-end rigs per those numbers), and probably closer to 1000x less, than those estimates.
  - throwawayaway 12y ago
    current hash rate GH/s: 300,000,000 //https://blockchain.info/charts/hash-rate https://blockchain.info/charts/hash-rate GH/s/w: 4.6 // http://www.coindesk.com/a-look-inside-kncminer/ http://www.coindesk.com/a-look-inside-kncminer/ watts to provite current hash rate: 300,000,000/4.6 = 65,217,391.30 w kw to provide 1s: 65,217.39 an hour of that: 65,217.39*3600 234,782,604 kwh 10c per kwh => $23,478,260.4 per hour 24 hours => $563,478,249.60 my own figures are even more wacky so I would welcome some better statistics.
    - brazzy 12y ago
      Your calculation is WAY off, which the bizarrely high end result should have made obvious. Multiplying by 3600 is where you go wrong. 65,217kW is the energy usage. Providing that for an hour takes 65,217kWh - not multiplied by anything. So that's $6,521 per hour, $156,521 per day.
      - throwawayaway 12y ago
TheDong 12y ago
Yes, bitcoin mining would be worse. Provably worse. As computers get better, traditional applications, like databases, perform better and you can either serve more customers, use cheaper (and often more efficient hardware), or do nothing and use your outdated hardware. With bitcoin, your enemy is not the performance of the raw work you are doing (you can hash better), but the fact that everyone else also has these increases. Because of that, the limiting factor is not performance, but cost, and so over time the average cost of the bitcoin network will not go down like the cost of centralized systems do. Let's do a thought experiment: Let's imagine that instantly all computers get 100 times faster but it costs 10 times the energy to run these faster machines (not actually that unrealistic) and the cost becomes 10 times cheaper. Traditional centralized banks can simply use a 10th of their existing hardware to have no energy-cost increase but a 10 times increase in customers they can serve. Sure, it's a bureaucracy, so it'll roll out slowly, but they're saving money too so maybe a little faster. Bitcoin, everyone will simply buy 10 times as much hardware since it's cheaper and they want to get a bigger bit of the pie (mining reward) before everyone else manages to buy all their hardware. You now have an equilibrium in terms of equipment cost reached again, but suddenly the hash-rate is 1000 times more and the energy consumption is 100 times more. The above might sound a little too theoretical, but if you look at the increase in hash rate and estimates for power usage of cpus, then gpus, and then asics, you'll see that in general power consumption for bitcoin constantly increases. You're arguing that the existing cost of banks / the existing system is high because it's legacy. Your argument doesn't say "and it's constantly, and provably, going to waste more energy as hardware gets more cost-efficient". Even if you want to claim that banks are currently less efficient (which I doubt they are), I hope the above convinces you that bitcoin over time will constantly use more energy thus resulting in an obviously more wasteful result, while banks and other centralized systems can take advantage of improvements and thus become more cost and power efficient over time.
- zamalek 12y ago
  > Yes, bitcoin mining would be worse. Provably worse. ... and exponentially worse as time goes on (by design).
  - 12y ago
skrause 12y ago
Minting, ATMs, secure transport, CC transactions are all things that can be optimized for lower energy if necessary. Bitcoin mining will always be a race on who can spend the most energy.
- moe 12y ago
  Bitcoin mining will always be a race on who can spend the most energy. No. It is a race on who can spend their energy the most efficiently. (in terms of hashes per kWh). That's why old mining methods (CPU miner, GPU miner...) are obsoleted by new ones (ASICs). You can pump a Gigawatt into an old GPU mining rig and it will only cost you a lot of money. Pump the same Gigawatt into a modern ASIC rig and it might make you money.

davidw 12y ago

> Because of that, I think this proof's place should have been to remain on paper. I'm not really a fan of bitcoin, and wouldn't touch it myself, but I think it's an interesting experiment.

spiritplumber 12y ago

I'd like something like Foldcoin where your proof-of-work is actually doing something beside keeping my home warm inefficiently.

synchronise 12y ago
I personally like the idea of Gridcoin more, because BOINC lets you use your processing power for other things than just folding proteins (although with Rosetta you can still do that) like searching for aliens or looking for gravitational anomalies.
- spiritplumber 12y ago
  Thanks, I didn't know that existed. Nice!
CyberDildonics 12y ago
So buy some.

olalonde 12y ago

Proof of Stake is a proposed solution to that criticism https://en.bitcoin.it/wiki/Proof_of_Stake https://en.bitcoin.it/wiki/Proof_of_Stake (although not free of criticism itself).

Normati 12y ago

The time to make these complaints was years ago, possibly on the way up a big boom just to show that you're confident in yourself despite the apparent evidence to the contrary. Now that it's going down doesn't mean it was caused by people realizing it wastes power, doesn't scale or doesn't pay interest. These are age old criticisms that haven't stopped the price from still being 10 times higher than it was when I first heard about bitcoins.