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And so will AC systems in local banks. The problem is not that something consumes energy if there are people willing to pay for that energy. The problem is how

by comboy 12y ago

And so will AC systems in local banks. The problem is not that something consumes energy if there are people willing to pay for that energy. The problem is how we generate electricity. It's getting better, but it has nothing to do with bitcoin.

engendered 12y ago
And so will AC systems in local banks. You can essentially include the entirety of operations of the bank, and the lifestyle of the people employed by the bank. There are literally millions and millions of people throughout the world who do nothing more than manage and monitor a system that moves numbers around and deals with proxy derivatives like bills and coins. Not that bitcoin is a panacea -- personally it seems completely untenable -- but if we want to talk waste, the current regime is extraordinarily wasteful.
- ncza 12y ago
  But how much (dare I say little?) of it would be unneeded if bitcoin succeeded?
  - tormeh 12y ago
    It can't succeed. Cryptocurrencies might succeed, but not bitcoin. It's not even inflationary; it's a cross between a payment system and a pyramid scheme. Its a bit pedantic, but please don't say bitcoin when you mean cryptocurrency, as bitcoin is a pretty bad one.
    - calinet6 12y ago
      Maybe a naïve question, but are there any good ones we should support instead?
    - oafitupa 12y ago
      > It's not even inflationary And that's exactly the whole point, and is the very reason it's working. > a pyramid scheme Then every other successful investment is a pyramid scheme. Gold is a pyramid scheme! Storing food for catastrophes is a pyramid scheme! Paintings are a pyramid scheme!
      - ufo 12y ago
        Not every investment has to be a pyramid scheme. If you are generating value or selling a product then you end up with more money than what your investors are putting in. What makes bitcoin into kind of a pyramid scheme is that right now a big part of the reward for miners is the 25 bitcoin you get from mining a block. Only a very small fraction comes from the transaction fees. The only way to keep bitcoin stable is by having a constant supply of new users buying into bitcoin by acquiring those fresh bitcoins from the miners.
  - the_mitsuhiko 12y ago
    I don't see a world in which Bitcoin would safe even only a single person in the traditional banking world. Bitcoin can neither replace banks nor creditcards. It might replace the ACH.
TimSAstro 12y ago
While I'll be interested to see how the blockchain gets exploited for new tech, there are a couple of problems with your statement. First, right now there is a problem with how we generate energy, and a centralized banking system should be a lot more efficient in that regard, for all its other flaws - Bitcoin relies on the calculations being difficult and therefore compute/energy intensive, after all. Second, even if we had perfectly clean energy generation, there is a limit to how much we can use unless we get into really crazy future tech like exhausting energy into space via refrigerant/laser system: see http://physics.ucsd.edu/do-the-math/2012/04/economist-meets-.. http://physics.ucsd.edu/do-the-math/2012/04/economist-meets-.... (also the `Sundiver' sci-fi!).
altoz 12y ago
And the computer systems that run the bank. And the disaster recovery systems that back up the bank. And the cars that come to the bank to do banking. And the construction vehicles that build ATM's, bank vaults, bank buildings. And the furniture production systems that supply the bank with furniture... It goes on and on. Most of that stuff, bitcoin doesn't have to do at all.
- oco101 12y ago
  I see this argument all the time.The point is that you cold achieve blockhain consensus without all that wasted energy and polluting the planet.
jgalt212 12y ago
I think that answer is more than a little flip. Certainly when you consider it's the highest up-voted answer. For such an answer, I'd like to see a broader discussion over value stores (gold, fiat, crypto). I know gold mining is very resource intensive with lots of undesirable by products. That being said, once you mine an ounce of gold, like bitcoin, it last forever. Fiat money, of course, takes almost zero energy to create. It's just a journal entry on some central bank's ledger system. That's just the creation side. On the use side, there are broadly different costs in using and maintaining gold-based, crypto-based and fiat-based money systems. I would like to see others way in on this.
skrause 12y ago
The difference is that you can optimize the current banking system for lower power consumption. Bitcoin mining will always be a race on who can waste the most resources/electricity for mining.
- PythonicAlpha 12y ago
  That is right, but does not take into account, that by construction, the system is becoming more efficient over time. The rise in computing power for every Bitcoin is reflecting that more transactions are done per Bitcoin over time. So, more and more efficient hardware is used and thus the relative energy needed per transaction is dropping.
  - mpyne 12y ago
    But that doesn't take into account that Bitcoin price increases (since we're assuming for the sake of argument that the price will actually reach insane heights again) cause mining hashrate to go up, which causes network difficulty to go up, which is by definition less efficient. In essence, Bitcoin's harm to the ecosystem is almost directly proportional to Bitcoin price.
    - PythonicAlpha 12y ago
      It does. The rate of transactions is growing faster than the Bitcoin price.
      - mpyne 12y ago
        My fingernails are growing faster than Bitcoin's price... the bigger concern is that Bitcoin is already near its practical transaction-per-second. Just a couple of weeks ago there were a few whole blocks' worth of unconfirmed transactions hanging out, and while that may have improved in the meantime it's just a harbinger of problems to come.
  - skrause 12y ago
    With more and more efficient hardware you'll just get a higher number of hashes per second and an increased difficulty. At least someone else will reinvest that saved electricity into more hardware, so you have to do the same to compete. Just imagine everyone using this more efficient hardware to save money on electricity, not increasing the mining difficulty. Eventually you'll have the risk of a single entity (e.g. a government organization) just buying enough hardware to have more than 50% of the hashing power, taking over the whole blockchain.
joosters 12y ago
The point about Bitcoin in particular is that it is deliberately consuming vast amounts of computing power. The mathematics behind the individual transactions and ledger maintenance are relatively simple. Getting computers to do this part requires almost no effort. It's the deliberate 'find a needle in a haystack' part of the protocol (which is there to ratelimit the creation of bitcoins) that wastes all of the energy. The fact that this needle-finding task is deliberately difficult, wasteful and time-consuming is the horrific part.
- celticninja 12y ago
  It's only wasteful if there is a better alternative, which there isn't so it's not. If you don't understand bitcoin it is easy to make the mistake that the electricity is just used to generate bitcoins, however it is also used to secure an international low cost payment network.
  - mpyne 12y ago
    > secure an international low cost payment network That's something which is actually handled fine in fiat, believe it or not. Nor is Bitcoin "low cost": Even with the price in the dumps recently a Bitcoin transaction still averages about $10 per transaction. Nor can Bitcoin feasibly handle international commerce, given that it's still capped in theory to 7 transactions per second, and in practice to 2-3 transactions per second, and this total capacity also has to support non-remittance transfers such as the normal exchange hackings (like BTER today) and SatoshiDice (which can take up about half of all Bitcoin protocol capacity on some days).
    - unabridged 12y ago
      >a Bitcoin transaction still averages about $10 per transaction. How does this make it not low cost? Transferring that $10 still only costs $.02 >capped in theory to 7 transactions per second Not 7 transactions but 7 settlements per second, which clear in under 60 minutes. You can have as many binding transactions per second as you want off the chain.
nhaehnle 12y ago
It would be interesting to see a comparison of CO2 emission by banks and by Bitcoins, keeping in mind (1) the relative scale of what they provide and (2) that Bitcoin provides only a payment system, and one whose security features are not well suited for most people, while the banking system provides much more than a payment system.
srdev 12y ago
Banks handle orders of magnitude more transactions and also offer many services beyond the basic Bitcoin network. Thats a dishonest comparison.

by comboy 12y ago

engendered 12y ago

And so will AC systems in local banks. You can essentially include the entirety of operations of the bank, and the lifestyle of the people employed by the bank. There are literally millions and millions of people throughout the world who do nothing more than manage and monitor a system that moves numbers around and deals with proxy derivatives like bills and coins. Not that bitcoin is a panacea -- personally it seems completely untenable -- but if we want to talk waste, the current regime is extraordinarily wasteful.

ncza 12y ago
But how much (dare I say little?) of it would be unneeded if bitcoin succeeded?
- tormeh 12y ago
  It can't succeed. Cryptocurrencies might succeed, but not bitcoin. It's not even inflationary; it's a cross between a payment system and a pyramid scheme. Its a bit pedantic, but please don't say bitcoin when you mean cryptocurrency, as bitcoin is a pretty bad one.
  - calinet6 12y ago
    Maybe a naïve question, but are there any good ones we should support instead?
  - oafitupa 12y ago
    > It's not even inflationary And that's exactly the whole point, and is the very reason it's working. > a pyramid scheme Then every other successful investment is a pyramid scheme. Gold is a pyramid scheme! Storing food for catastrophes is a pyramid scheme! Paintings are a pyramid scheme!
    - ufo 12y ago
      Not every investment has to be a pyramid scheme. If you are generating value or selling a product then you end up with more money than what your investors are putting in. What makes bitcoin into kind of a pyramid scheme is that right now a big part of the reward for miners is the 25 bitcoin you get from mining a block. Only a very small fraction comes from the transaction fees. The only way to keep bitcoin stable is by having a constant supply of new users buying into bitcoin by acquiring those fresh bitcoins from the miners.
- the_mitsuhiko 12y ago
  I don't see a world in which Bitcoin would safe even only a single person in the traditional banking world. Bitcoin can neither replace banks nor creditcards. It might replace the ACH.

TimSAstro 12y ago

While I'll be interested to see how the blockchain gets exploited for new tech, there are a couple of problems with your statement. First, right now there is a problem with how we generate energy, and a centralized banking system should be a lot more efficient in that regard, for all its other flaws - Bitcoin relies on the calculations being difficult and therefore compute/energy intensive, after all. Second, even if we had perfectly clean energy generation, there is a limit to how much we can use unless we get into really crazy future tech like exhausting energy into space via refrigerant/laser system: see http://physics.ucsd.edu/do-the-math/2012/04/economist-meets-.. http://physics.ucsd.edu/do-the-math/2012/04/economist-meets-.... (also the `Sundiver' sci-fi!).

altoz 12y ago

And the computer systems that run the bank. And the disaster recovery systems that back up the bank. And the cars that come to the bank to do banking. And the construction vehicles that build ATM's, bank vaults, bank buildings. And the furniture production systems that supply the bank with furniture... It goes on and on. Most of that stuff, bitcoin doesn't have to do at all.

oco101 12y ago
I see this argument all the time.The point is that you cold achieve blockhain consensus without all that wasted energy and polluting the planet.

jgalt212 12y ago

I think that answer is more than a little flip. Certainly when you consider it's the highest up-voted answer. For such an answer, I'd like to see a broader discussion over value stores (gold, fiat, crypto). I know gold mining is very resource intensive with lots of undesirable by products. That being said, once you mine an ounce of gold, like bitcoin, it last forever. Fiat money, of course, takes almost zero energy to create. It's just a journal entry on some central bank's ledger system. That's just the creation side. On the use side, there are broadly different costs in using and maintaining gold-based, crypto-based and fiat-based money systems. I would like to see others way in on this.

skrause 12y ago

The difference is that you can optimize the current banking system for lower power consumption. Bitcoin mining will always be a race on who can waste the most resources/electricity for mining.

PythonicAlpha 12y ago
That is right, but does not take into account, that by construction, the system is becoming more efficient over time. The rise in computing power for every Bitcoin is reflecting that more transactions are done per Bitcoin over time. So, more and more efficient hardware is used and thus the relative energy needed per transaction is dropping.
- mpyne 12y ago
  But that doesn't take into account that Bitcoin price increases (since we're assuming for the sake of argument that the price will actually reach insane heights again) cause mining hashrate to go up, which causes network difficulty to go up, which is by definition less efficient. In essence, Bitcoin's harm to the ecosystem is almost directly proportional to Bitcoin price.
  - PythonicAlpha 12y ago
    It does. The rate of transactions is growing faster than the Bitcoin price.
    - mpyne 12y ago
      My fingernails are growing faster than Bitcoin's price... the bigger concern is that Bitcoin is already near its practical transaction-per-second. Just a couple of weeks ago there were a few whole blocks' worth of unconfirmed transactions hanging out, and while that may have improved in the meantime it's just a harbinger of problems to come.
- skrause 12y ago
  With more and more efficient hardware you'll just get a higher number of hashes per second and an increased difficulty. At least someone else will reinvest that saved electricity into more hardware, so you have to do the same to compete. Just imagine everyone using this more efficient hardware to save money on electricity, not increasing the mining difficulty. Eventually you'll have the risk of a single entity (e.g. a government organization) just buying enough hardware to have more than 50% of the hashing power, taking over the whole blockchain.

joosters 12y ago

The point about Bitcoin in particular is that it is deliberately consuming vast amounts of computing power. The mathematics behind the individual transactions and ledger maintenance are relatively simple. Getting computers to do this part requires almost no effort. It's the deliberate 'find a needle in a haystack' part of the protocol (which is there to ratelimit the creation of bitcoins) that wastes all of the energy. The fact that this needle-finding task is deliberately difficult, wasteful and time-consuming is the horrific part.

celticninja 12y ago
It's only wasteful if there is a better alternative, which there isn't so it's not. If you don't understand bitcoin it is easy to make the mistake that the electricity is just used to generate bitcoins, however it is also used to secure an international low cost payment network.
- mpyne 12y ago
  > secure an international low cost payment network That's something which is actually handled fine in fiat, believe it or not. Nor is Bitcoin "low cost": Even with the price in the dumps recently a Bitcoin transaction still averages about $10 per transaction. Nor can Bitcoin feasibly handle international commerce, given that it's still capped in theory to 7 transactions per second, and in practice to 2-3 transactions per second, and this total capacity also has to support non-remittance transfers such as the normal exchange hackings (like BTER today) and SatoshiDice (which can take up about half of all Bitcoin protocol capacity on some days).
  - unabridged 12y ago
    >a Bitcoin transaction still averages about $10 per transaction. How does this make it not low cost? Transferring that $10 still only costs $.02 >capped in theory to 7 transactions per second Not 7 transactions but 7 settlements per second, which clear in under 60 minutes. You can have as many binding transactions per second as you want off the chain.

nhaehnle 12y ago

It would be interesting to see a comparison of CO2 emission by banks and by Bitcoins, keeping in mind (1) the relative scale of what they provide and (2) that Bitcoin provides only a payment system, and one whose security features are not well suited for most people, while the banking system provides much more than a payment system.

srdev 12y ago

Banks handle orders of magnitude more transactions and also offer many services beyond the basic Bitcoin network. Thats a dishonest comparison.