Not really. But the gist of it is that you can "sell art" encapsulated in NFT tokens. Something like you would encode an image into such a token and then it's "forever" stored in the chain and can't be replicated. At least that's how I understand it.
Most of his argument is based on the ecological impact. His other complaints are stated as facts and lack arguments.
It's about how he's against the tokenization of art, which happens on the public ethereum blockchain. Tokenization brings uniqueness to digital goods, because it allows you to prove ownership if all parties involved accept the blockchain as a source of truth.
Edit:
I see I am getting downvoted for simply stating facts again. Perhaps you could try and debate instead?
That's fine, you state why you downvote. Now there's something to discuss at least, that's not the type of downvote that is deleterious for discussions. Not saying anything and just downvoting is simply silencing people you disagree with and that's why I mentioned it.
I don’t get the downvote system, sometimes I get downvoted for no reason, sometimes I get downvoted for asking on legit but grey comments without comments why it got downvoted, etc..
Downvoting without providing a reason is indeed demoralizing and toxic imho.
There is a subtheme about crypto, in that he kind of argues it isn't really useful enough as a financial instrument to warrant the ecological cost (my words, not his).
That's an opinion - one I tend to share - so feel free to disagree.
As a digital artist I find them highly intriguing to consider. As a person I still can't figure out why people would be paying me for a hash and not actually get anything.
1. Money Laundering: If you made money from a pump and dump or something otherwise nefarious that you want to convert back to USD and explain away, a good way is to mint digital art and sell it to yourself. Then when you report it to the IRS you made $100,000 from selling digital artwork to an anonymous buyer instead of from insider trading a low market cap coin. This is not so different from how art works in meatspace (see Mark Rothko).
2. Charity: It's hard to really grok this if you don't live in the crypto world but people make insane amounts of money from Ethereum. I know multiple people who are under 30 and have each made upwards of $500,000,000 from buying ETH in the presale / insider trading in bull markets. Generally someone who bought into the ETH presale is a mega crypto bull and keeps a large percentage of their net worth in crypto. It's trivial for them to support artists by buying their artwork for a minuscule fraction of the money they've made. What sounds like "buying a .jpg for thousands of dollars" to someone not in this world, is more like the crypto equivalent of tipping a live streamer a bit on twitch.
I think it's really similar to art. It's more about your relationship with the artist or the emotion that makes you want to own the original... And of course, the art market.
It's speculation. People who buy highly expensive pieces of art and store them in a vault in Geneva* don't enjoy them in any way. It's a value store.
Why not buy Bitcoins instead? I think it has to do with the cool factor. It feels probably better to own an NFT than a Bitcoin, as it feels different to own actual art than stock in the Coca-Cola company.
(I can only guess though, I have never owned any of those.)
It's a digital unfakeable deed to an asset, that asset being a trading card, artwork or something else. It's no more of a scam than selling the rights to say a song you made. Although in both cases some might scam by selling/using stuff they don't own.
One major scam that's lower effort here is that you can simply sell someone else's digital art. Selling physical art forgeries has always been a thing but the risks involved in doing it (i.e. what if you get caught) and the costs (faking a detailed painting isn't EASY) mean it's not as attractive as just grabbing some Japanese or Chinese artist's stuff off Pixiv and selling it as an NFT to english speakers, where the original artist may never find out about it.
Except if I bought the rights to a song (like Hipgnosis Songs Fund are doing, for instance), I could profit off them as the song is mine. As far as I understand, for the most part with NFTs, it's more akin to buying a baseball card - I can't reproduce or profit off it, I just 'own' it.
> It's a digital unfakeable deed to an asset, that asset being a trading card, artwork or something else.
Well...no. Quite the opposite. The art is an asset. NFTs are not the artwork, and they're not a deed to the artwork. Buying an NFT gives you ownership of the NFT; it doesn't give you ownership of the artwork.
Selling digital unfakeable deeds to an artwork, and trading those deeds on the blockchain, sounds really cool. That might have value! But to the best of my knowledge, nobody has done that, largely because it's utterly impossible and we have no idea how to even go about trying to do it. And in any case, NFTs certainly aren't that. You're not buying and selling the artwork, you're buying and selling a numbered acknowledgement that the artwork exists.
I thought each token cost over a hundred dollars to mint. Otherwise I'd play around with adding a few things. As it is, it's gambling to see if someone will want to pay you more for what you minted than the cost to mint it, right?
Every time I read a thread on Bitcoin / cryptocurrencies, its filled with assmad people who talk about how it destroys the environment, solves a problem no one has/had (moving $50 million for $1.00 in under an hour is, I guess, admittedly a problem very few people have), sucks up their precious GPUs that they would be using to train a deep learning model that identifies the most handsome pigeons in Central Park, etc. so forth.
I always enjoy the few people like yourself who call it like it actually is.
Despite acknowledging PoS, the author keeps hammering on PoW. Their actual problem is with PoW and has little to do with NFTs.
If you are worried about the environmental impact (which for 1 minting is fairly small) just use the PoS options available today and rant about ETH generally using PoW instead.
>The article makes specific claims to the contrary
Which are unsubstantiated. One minting is basically one (largish) transaction. Transactions arent quite that expensive, it costs maybe $50-100 and you definitely don't put months of electricity to earn that little as a miner. I don't have the numbers but it doesn't check out.
>Does PoS actually work today? AFAICS it's vaporware.
I think until NFTs can actually be minted and distributed via PoS, PoS doesn't matter. It's been "coming soon" for ages. I eagerly await Ethereum's transition to PoS but today when you sell crypto art it's PoW.
>I think until NFTs can actually be minted and distributed via PoS, PoS doesn't matter. It's been "coming soon" for ages
It's been coming soon on ETH. Again, you can use PoS options today outside of ETH. Tezos is a popular one, and even the biggest ETH marketplace (opensea) is adding Tezos as an option right now.
There are platforms that don't use PoW that are becoming quite popular. The NBA's Top Shot platform is built [on Flow](https://www.onflow.org/primer) which does not use PoW.
I'm not making _any_ claim about the worthiness/sustainability of the platform, just that it is what is being used. The list of "communities" on the Flow landing page suggests that it's being considered for a couple of high-profile platforms.
> today when you sell crypto art it's PoW.
I think more specifically when you sell crypto art on a platform that uses PoW, which makes this sentence a truism.
The article has a strong focus on the environmental impact, but a subtheme exists questioning the real value in cryptocurrencies at all.
The author addresses the existence of Po[X]:
"""
I’m sure you’re seeing the problem here- there is not a schema that doesn’t reward those who already are already wealthy, who are already bought in, who already have excess capital or access to outsized computational power. Almost universally they grant power to the already powerful.
I’ve come full circle on crypto. Crypto is an example of capitalism eating itself.
When the value of crypto is high, large amounts of economic output are funneled into crypto at the expense of other opportunities. NVidia expects supply shortages of its newest line of video cards (released in December and going for $1500+ on eBay from an MSRP of $700) to extend into 2022. Oh yeah, and this happens every time a new generation of chips is released. Hope you didn’t need any to train ML models.
The "problem" is with the people who missed out on Bitcoin and can't compete with Chinese miners.
I started out mining BTC on a Core2Duo laptop from 2006, in 2010. I upgraded to a Butterfly Labs Jalapeno miner. Then I started to realize Chinese miners were soaking up the mining equipment and many of them were getting industrial power rates.
Then people who couldn't afford / acquire BTC ASIC miners made more ridiculous alt-coins that they could mine with GPUs. Cryptocurrency isn't the problem, people butthurt about missing out and wanting to make their own coin are the problem.
The problem is the industrial Chinese miners. These companies soak up enormous amounts of resources while producing... nothing. It’s horrible for the environment, and it’s a net drain on the economy for what I believe to be ephemeral value largely driven by low interest rates and a lack of high-growth investment options.
> what I believe to be ephemeral value largely driven by low interest rates
This is part of the story, the other part would be central banks printing money nonstop, or in common parlance, "money printer go brrr".
Bitcoin can only exist in a post-2008-financial-crash world. Prior to that, there was no reason to consider anything other than the US Dollar. Bitcoin, however, is a solution to only one part of an overarching problem, or at least this is what I think: financial services need to be reigned back in if we have any hope as a species of surviving. Continued worldwide crashes caused by financiers engaging in riskier and riskier behavior in the name of enormous profits will eventually result in a war when one of the nations on the "losing end" decides they've had enough.
I could actually give a shit less about a video card because the one I have is fine (and selling on eBay for $100 more than I paid for it in 2017); the real story is that we’re allocating a meaningful percentage of global semiconductor output to an industry that generates no lasting economic value. It also increases the boom/bust volatility in the semiconductor sector because arbitrage opportunities are time-sensitive, thus miners need them ASAP before the hash difficulty goes higher.
people don't realize we will soon be able to harvest the heat from PoW into renewable energy. Research is being done on thermoelectric materials. Yelling about the environmental impact is a cop out, no technology started out its life as performant, sustainable and carbon neutral.
A future where the environmental impact of PoW is minimized sounds like a great future. That future does nothing to slow the ongoing climate crisis today and it does nothing for the vulnerable people in coastal areas, hot climates, etc tomorrow. If we were talking about 'NFTs once PoW is not environmentally hazardous' that would be great, but we're talking about NFTs today.
Bitcoin mining is low on the list in terms of problems that need fixing in order solve climate crisis today. Bitcoin haters just love to harp on that fact.
The environmental issues with crypto need no more solving than the environmental issues associated mining gold (much worse), producing aluminum, and in a wider sense humans doing things on earth need solving --- which is not to say that they don't, but to single out bitcoin is disingenuous, uninformed, or just plain neophobic.
The article addresses this. In summary: both things are bad, but it would be nice to not make them worse. Expanding the power spent mining crypto makes them worse, with how things are right now at least.
Also, NFTs are generally based on Ethereum, not Bitcoin. Did you read the article?
and these applications give people a fuzzy warm feeling that lasts for about a month before it recedes and attention shifts elsewhere.
I have it on good authority that owning bitcoin gives people a very similar kind of feeling and there is nothing wrong with that. humans doing human things.
of course now there's plenty of arbiters of what constitutes proper warm fuzziness, and apparently a new BMW made from aluminium and steel is AAA+, but buying 0.1 of a bitcoin is not.
Well, when we think about it, the things with the most value are usually the ones that harm the environment the most. Rare foods... Big petrol cars... Traveling to far-off destinations...
We think of them as having _other benefits_ besides environmental costs, but is this true? Is it better to travel far away to enjoy nature and a magnificent view, or to have the patience to look at things living in your own backyard for example?
Unless these things are being used as status symbols, or the person in question is actively attempting to destroy the environment, there must be some other benefit. Indeed, I certainly don't consider environmental cost to be a "benefit".
My "big petrol car" (which isn't really so big; more of a mid-sized coupe, but I digress) gives me the following benefits:
- "Warm fuzzy feeling" (the rumble, the hum, the traditional construction, etc).
- Plenty of power when I want it
- A traditional, relatively simple design that I understand; when something breaks or needs maintenance I can generally fix it. Some electronics, but not riddled with it throughout every system as today's vehicles are.
> Is it better to travel far away to enjoy nature and a magnificent view, or to have the patience to look at things living in your own backyard for example?
Well, not everybody has much of a backyard to speak of; however...
I would say that both are good. I don't get to travel much. Once every couple of years if I'm lucky. I wish I could more often. I probably won't even see most of my own country in my lifetime, let alone the wider world, and that... seems something of a shame. To imply that this feeling is somehow connected to the environmental cost of travel, well... seems a bit off.
A worldwide shortage of gaming video cards. I've been thinking about building a new box for a couple of YEARS now, waiting on the prices to come down. I don't have any hope of that for at least another year.
My current "build" is an Athlon64 with a 760. Surprisingly, it plays a lot of games just fine, but there's really no point in putting a 760 in anything like a Ryzen. ;-)
Interestingly, the amount of real resources (as percentage of GDP) spent mining gold have increased since most of the world went off the gold standards.
No they certainly need solving, that is, if we are able to justify them causing any environmental impact at all.
If can start on the agreement that we need to curb our environmental impact, then any new technology we embrace surely needs to be very useful to as many people as possible in order to justify any significant affect on the environment.
That argument has the distinction of being universally valid, so no single issue will ever be tackled following its logic.
And just to be clear: Bitcoin is a bit more pushback than, say, residential heating, because it’s an entirely new CO2-emitting industry, and it is neither necessary nor beneficial except maybe for the thin slice of humanity that spends too much time on Reddit.
It’s not just that it’s new, but that it is wasteful by design. If you were to create a miner with 2x efficiency and make it generally available, the mining market would not have an incentive to halve their energy use, they would just double the hashrate.
In other industries carbon emissions are an issue too, but at least there are people trying to bring energy use down with technology. Bitcoin’s difficulty mechanism nullifies any such attempts.
Exactly. Bitcoin advocates like to point at the fiat economy and ask, "but what about the banks and the offices and the ATMs and the security vans, ...?". Yes, added up, they use more energy than Bitcoin (looking at the trends, probably not for long). But the core difference is that for fiat economy, energy use is upkeep. It's the cost they want to minimize, because it eats into margins. They have every incentive to make all operations as energy efficient as possible. Bitcoin, on the other hand, structurally relies on ever growing energy waste.
> the difficultly of mining blocks in the blockchain is designed to increase over time. This is because as the network grows, the relative rate of new coins mined stays stable (for Bitcoin, about 1 coin is mined every 10 minutes).
This is not correct. About 1 block is mined every 10 minutes, while block rewards decrease over time.
The one block per 10 minutes is also what is kept stable, and the reason mining difficulty increases over time. There is nothing in BTC mandating the difficulty to increase, and indeed it does decrease sometimes.
Is there any evidence that cryptocurrency actually had a significant impact on real CO2 emissions? The idea that raising energy usage somewhere commensurately increases emissions based on the "energy mix" that predated that extra usage is an oversimplification.
Most of the mining happening in China, for instance, is happening near non-CO2 emitting plants (hydropower, wind) where energy is virtually free most of the time. The increased demand for energy that is otherwise of little value may in fact be financing a rollout for renewable energy. The primary problem with renewables like wind power today is not production capacity, it is storage.
It stands to reason that at least some mining temporarily leads to increased CO2 emissions due to revenue exceeding the cost of fossil fuels. However, this only happens in the short term, because of difficulty adjusting revenue to the point where only the very cheapest energy sources remain competitive, and these are not fossil fuels. Furthermore, the increased demand for more efficient semiconductors finances the R&D required to lower the power usage of all computing into the indefinite future.
The post addresses this question in detail. In brief summary, extracting "green" energy from the grid (most mining occurs on the grid) means that the energy available on the grid is more likely to be from CO2-generating sources. The amount of demand for that grid power is partially non-negotiable (things like street lamps, life support equipment in hospitals, etc) and partially negotiable (if the cost goes up enough people might stop using tv or indoor lighting, I guess?), but ultimately if demand spikes there will just be more coal and gas getting burned to provide power on the grid.
Also, the green power generation requires the manufacturing and distribution of things like solar panels, which is not currently CO2-neutral and has other environmental impacts.
There are also theoretical (if not real) limits to how much you can actually expand grid capacity. Mining already even in conservative estimates consumes a lot of power, and unless PoS is fully rolled out it will continue to consume more and more, which will put increasing strain on local power grids.
The post you were replying to is disagreeing with this. Power made available for extremely low cost next door to a hydroelectric dam etc. might be technically "on the grid" in that there is some connection between that town and the rest of the grid, but if the long-distance transmission lines are already at maximum capacity (which is usually the case, otherwise power wouldn't be any cheaper in those towns than anywhere else) then that surplus power is de facto not available to the rest of the grid.
Are you suggesting that the vast majority of mining operations are running on direct/dedicated links to local power generation facilities? I can understand the argument that some significant fraction are, but there's still a huge amount of mining that would by necessity have to happen on the grid. If consumers or small-time business owners get involved in crypto they have no choice but to use the grid. The costs involved in building out dedicated lines like that are not trivial, so I'm kind of skeptical that it would be widespread enough to make on-grid mining a rounding error. Do you just mean that in terms of revenue, all the big-earning miners are hooked directly up to dams?
> Are you suggesting that the vast majority of mining operations are running on direct/dedicated links to local power generation facilities?
Not necessarily in the sense of having their own physical wire, but if the path from the power generation facility to where the mining is taking place doesn't take up any long-distance transmission capacity (which is why power in those towns is cheap) then it's de facto the same thing.
> there's still a huge amount of mining that would by necessity have to happen on the grid. If consumers or small-time business owners get involved in crypto they have no choice but to use the grid.
If they want to participate as full nodes, sure. Maybe they shouldn't. And even if they are, they're going to be an insignificant fraction of mining volume.
> The post addresses this question in detail. In brief summary, extracting "green" energy from the grid (most mining occurs on the grid) means that the energy available on the grid is more likely to be from CO2-generating sources.
This is a hypothesis, but where is the evidence, i.e. actually increased CO2 emissions? My argument is that most of this mining is using electricity that would otherwise not be used or produced. That is why it is so cheap in the first place.
We have concrete evidence from the recent storms in Texas, where CO2-producing power generation was spun up in order to respond to demand once the price caps were lifted so it could be profitable. It's up to you to decide whether Texas is an outlier.
If the power was literally not being used the cost would be negative - this is a real thing that happens. If it costs you more than $0/kWH you are creating demand and potentially increasing CO2 emissions.
> It's up to you to decide whether Texas is an outlier.
That isn't really related. Like I said, it's possible the temporary spikes in prices can make mining with fossil fuels profitable, but that is in the short term.
> If the power was literally not being used the cost would be negative - this is a real thing that happens.
Price only goes negative when there is too much energy produced, but downregulating production would be even more expensive. This is mostly a problem with wind energy combined with coal or nuclear plants. Otherwise you would downregulate production so you don't have to pay the penalty. Consuming this excess energy in a profitable manner would keep prices above zero.
Then there are other societal costs. Like people losing power. https://www.independent.co.uk/news/world/iran-bitcoin-electr...
Even rising cost of electricity and added pressure on ASIC/GPU production due to bitcoin is an externality we all pay for. Ask anyone who has been trying to buy a GPU for the last 6 months.
You're lamenting the short-term downside, but you ignore the long-term upside. If it hadn't been for the crypto boom, GPUs would not be where they are today.
I find that really unlikely. Machine learning, rendering, and other massively parallel workloads were plenty to keep gpus advancing. All the crypto boom did is create shortages and raise prices. At best we got some additional chip fabrication capacity, but crypto continues to eat that.
> At best we got some additional chip fabrication capacity, but crypto continues to eat that.
That’s the funny thing about this genre of arguments (Bitcoin improves GPU tech; Bitcoin subsidizes clean energy) — even if true, the gains will only be realized if there’s a crypto price crash, since otherwise mining absorbs the gains that it is responsible for by definition.
Not at all, the refinement in semiconductor production is a permanent benefit into the future for every computing application. GPU mining has only caused temporary shortages three times in the past 10 years. Prices don't need to crash either, due to difficulty adjustment the profit will trend towards marginal cost, which can only be reduced with better technology.
Improvements in semiconductor manufacturing would happen either way eventually; to the extent that Bitcoin accelerates them it is (by definition) by creating the demand that necessitates them.
It's not zero-sum. These improvements are externalities, they are permanent and apply to all other uses of computing.
Similarly, one can point out all the advances that the Apollo program brought that are unrelated to space travel. COVID brought in lots of scientific insights that will bear fruit regardless of whether we have to deal with any other coronaviruses in the future.
Sure, and smoking is responsible for advances in lung cancer research. It's the broken-window fallacy, though. The resources that were reallocated to lung cancer research due to smoking could have been used for other things.
The broken window fallacy does not consider the benefits from improvements of technology that may result from destruction. Suppose that smashing a bunch of windows would lead to permanent improvements in glassmaking efficiency. In that case, the benefits in the long run would far outweigh the short term costs. Of course, that's not a given with any form of destruction, but I am arguing that it is the case with cryptocurrency.
The fallacy does account for that. In a counterfactual where the windows were not broken, the effort spent improving the efficiency of glassmaking would have been directed (by the invisible hand) to improving the efficiency of something else.
It doesn't account for that. If it did, it would assume improving the efficiency of one thing is equally valuable to improving the efficiency of any other thing, which is absurd.
Like I said, not all destruction is destined to create excess value, but some destruction is, and I am arguing that this is the case here specifically. A counterfactual where this money would've been spent on something even more beneficial doesn't really matter. It wasn't spent that way and it could also have been spent in numerous other ways that are even less beneficial.
> Machine learning, rendering, and other massively parallel workloads were plenty to keep gpus advancing.
I think the opposite is true. Now that we have cheap GPU accelerators, the machine learning revolution is taking place. But where does that cheap GPU accelerator come from? Clearly, the more frivolous "gaming demand" was paving the way for machine learning, not the other way around. It's similar for mining.
> All the crypto boom did is create shortages and raise prices.
Rising prices are a signal to the market that production needs to be increased, which lowers prices in the long term. Shortages are short term.
Why do people believe there are all these hydroelectric plants in China that are too far away from consumers and therefore ran idle before Bitcoin? Is there something about China that makes people believe the laws of physics and/or economics don’t apply?
A few minutes with Wikipedia and a calculator would also lead to the conclusion that transmission losses in the worst case of having to transmit the power the longest straight line within Chinese borders are somewhere between 5 and 10 %.
1. If you are the Communist party and you are planning electricity for a 5M inhabitants city in 2007, growing at 9% (doubling every ~7 years, electricity use is highly correlated with economic growth), you need to make the plants 10 times bigger than needed for them to last 20 years
2. Mining equipment is placed next to the source of electricity
3. Corrupt officials are co-opted (just turn on that turbine that is wasted working capacity for you, and I'll pay you in cash)
4. Profit?
FWIW, I think this doesn't happen exclusively in China but in every place where there's idle energy capture potential.
You can't just turn on a second turbine because it's wasted anyway, it's the water reserve that is the currency here. It runs out faster if you use all turbines.
"I’m sure you’re seeing the problem here- there is not a schema that doesn’t reward those who already are already wealthy, who are already bought in, who already have excess capital or access to outsized computational power. Almost universally they grant power to the already powerful."
Now I'm imagining a crypto currency that just gets awarded randomly to any person on the planet in a world-wide lottery. Or it could get distributed evenly like UBI to everyone.
> But without the early movers incentive to increase the coin value, how could that work?
Are you seriously asking how having the value distributed out to a large number of people could ever have utility without oligarchs to "set the value" to some "proper" value?
I’m seriously asking for new ideas. This space is new and free to rethink incentives in all sorts of ways, it doesn’t need to repeat the same mistakes as fiat.
Yes. If we split all the bitcoins up into 7.8 billion pieces and distributed them to everyone on the planet ... what do you think bitcoins would suddenly be worth? Would each slice still be worth ~$100 or would the market simply collapse?
The value would end up pegged to the price of a bag of weed on the dark markets, as that category of trade is the only genuinely useful application of cryptocurrency that's been found so far.
I wonder how much we'd see a spike in crypto UBI fraud, where people find ways to scam people into transferring their crypto or claim it on behalf of non-computer-owners. We saw a lot of this with stimulus checks and tax returns in the US over the last decade.
If you can solve Sybil attacks in a fully decentralized network — such that the rich can’t buy an arbitrarily large number of lottery tickets, then not only is this particular idea possible, but so many others.
If you devise a way to have a proveably fair worldwide lottery for every human on the planet at essentially zero cost to each participant, in a decentralized network, I think you would will win a Turing at least if not a Nobel, aside from making billions of dollars.
You need a random oracle that outputs a value that maps 1:1 to a human in the world, probably without any form of pre-registration, because any registration function can be reused by the same human multiple times.
Basically a decentralized technology that can identify souls on the planet and randomly select them in a Byzantine fault environment. As of today, entirely indistinguishable from magic.
Of course it’s possible to do with a centralized registration system, but building and deploying such a tracking system IMO is akin to a war crime.
The amazing thing is, that utopia still would not work!
Imagine you did that, everybody has 1 UniversalToken every newborn gets one (and people are absolutely not killing they own children for personal gain as it was done throughout the human history, I diverge). And by yet another miracle this token has some value.
You know exactly what those struggling financially do with that token right away. Food is better than tokens.
You also know who will buy it.
Thy system self-"corrects" itself right away.
I've been thinking about it for some time. Fiat system is flawed, it literally takes money away from the bottom and puts it at the top (inflations + being able to diversify outside cash + loans + bailouts). But even the most perfect forms of money seem to have inherent unfairness in them. Money makes money. Having time to research possible investments, having money to do them, being able to afford risk, liquidity that allow you to avoid loans (unless you want to use them for leverage) etc. At least as long as people sell their time which seems like the foreseeable future.
If you were hoping for me to offer some solution I have none.
<daydreaming> But on the long enough run (if we have one) I think money will become irrelevant and our society will be more like a single organism. A shift in entity and entities mindset to be more oriented towards information processing and achieving specific goals / playing specific role and less driven by the limbic system which now can be satisfied at will if still present. I mean, it sounds mooshy wooshy, but look around your lucky good coders bubble. I think money is already losing value for those who don't worry about basic needs (while of course still being solution to 95% of problems for those less lucky, which seems great to remember).
In more strict terms, the only valuable thing on the long run is information. I hope for some well-grounded disagreement on that.
Poverty is not Sybil-resistant, capital is. There's nothing keeping you from pretending to be ten or ten thousand poor people instead of one rich person. In the real world we have to use strong, centralized identity checks to validate things like welfare programs or voting. These cannot be turned into distributed systems and remain robust to manipulation. You only get the security guarantees of crypto from actually scarce resources.
That being said, this has been done, but usually off the backs of existing blockchains. In Etheriumland this is known as an "airdrop" and is considered a form of annoying spam these days. Of course, if you actually wanted a wallet full of no-name ICOs you could just send coins back and forth to yourself to keep your address on the blockchain so that you got more airdrops. This is bounded mainly by gas price (which is artificially made scarce through protocol limits), but I wouldn't consider this system robust or equitable.
> Digital files don’t have that much going for them. They store monumentally less information than say, a piece of paper- which contains the artwork on it as well as inscribed histories of hand, pen, ink, pulp, forest- a dense connected materiality that unfolds forever. A digital file is a pauper in comparison. A file breaks down to requisite ones and zeros well before one can reach the atomic composition of the materials in a physical drawing.
> Digital files also require power to access and maintain, and are incredibly unstable over time as new operating systems, plugins and standards render things unviewable- often within a decade. They are also vulnerable to bitrot and physical degradation of storage media- the stable shelf life of a CD-ROM, for instance, is less than 20 years.
This is pretty much nonsense. The actual artwork on a piece of paper will typically be lower fidelity than a digital version of it, and paper degrades faster than CD-roms. I've dug out a CD full of photos that spent 10 years in a damp attic, and the photos are as good as the day they were taken - try that with photos printed on physical paper. Furthemore, while an NFT is by design not copyable in some sense, it's certainly not vulnerable to degradation of physical media.
There are books printed on paper that have survived dozens if not hundreds of years under the correct archival conditions. We do not currently have a means to do the equivalent with CDs. Just ask the people working at places like the Internet Archive.
Both sides of this have pretty good counterexamples. There's an experimental way to encode data on crystals (using lasers, I recall?) that last a very very long time. The more feasible example though would be archival tapes used in long term cold storage, that also do quite well.
For physical medium, given the right storage conditions, you can store film for quite a while, and that technically has infinite resolution in comparison to a digital copy.
>The actual artwork on a piece of paper will typically be lower fidelity than a digital version of it, and paper degrades faster than CD-roms.
I think the post does a nice job of countering this; a physical object will always contain much more information (in the Shannonian sense) than any digital alternative could, and that goes far beyond things like DPI.
Which is to say that it will contain more noise. The digital equivalent will be more faithful in recording deliberate details, which is surely the part that's art.
> The actual artwork on a piece of paper will typically be lower fidelity than a digital version of it, ...
I don't know your definition of fidelity, but a paper artwork is full of details and a digital capture of it will loss information. Consider the tridimensional nature of real paper and paints, or the infinite interplay between light and medium. You can't capture any of that information in a digital copy.
Also, the argument about longevity is not that clear cut. We can see paintings in cave walls from thousands of years ago, same with stone carvings. Let's see if you can render a JPG 10.000 years from now. (without having to reconvert/maintain it each epoch)
The solution to proof of work using too much energy is not proof of work. It's fractional reserve bitcoins / ethereum / etc.
To explain:
For game theoretic / economic reasons, people will spend as much effort mining as there are mining rewards to be claimed.
If move to a system that doesn't hand out mining rewards, you still have to hand out the coins on some basis. So people will do the activity of that basis as much as there are rewards.
I will talk about bitcoin for simplicity.
It behaves very much like gold in a lot of respects.
If bitcoin sees wider adoption as cash, that means it will have to support a larger amount of spending in real terms and also a larger demand for real balances held in 'cash'.
Since the total nominal amount of bitcoins is fixed, you can only get the latter via an increase in the real value of each bitcoin.
But, here's the solution: gold was (and is) also hard to mine, but even when gold was money, you didn't actually need physical gold coins to serve most of your cash needs.
Bank notes and 'checkable' deposits fill this very need: they allow to expand the effective money supply without needing to mine more gold. The same will work for bitcoin.
(Of course, only that the banknotes will be electronic, of course.)
We already see some signs of that eg in bitcoin futures. The only way to get investment exposure to bitcoin used to be buying physical bitcoins. But nowadays you can buy (and roll over) bitcoin futures instead.
Of course, every future needs a counter party that's taking the opposite side of that exposure.
If you think about it, that's pretty much the same thing that banks do. Selling futures is very similar to offering time deposits:
With a time deposit, the bank incurs an obligation to pay a certain amount of money later. They could hedge that obligation by just holding on to physical money, but more typically, they invest in assets like bonds and loans, and hope to be able to exchange them for money when they have to pay back the time deposit.
That's basically the same economic exposure as being short a bitcoin future and going long a bond future.
To end the long rant, even if your base currency is gold or bitcoin, you can support lots more money than that.
What is your basis for the ecological impact of this article? A static html file can be served to thousands of users by a single ARM-based PC in a datacenter or on a home connection, probably drawing less than 100W if not less than 20W.
TL;DR: Ethereum uses a lot of energy, we shouldn't use it for anything non essential because it wastes energy.
Contrary to the article title, 90% of the arguments exposed are just rehashing why energy waste os bad, and why we shouldn't make use of it for NFTs.
10% of the article ("the many other reasons") is a critique of the art circuit and imho, a little ranty about how hard it is to get rich from art.
The actually interesting part of the article is at the end, but its just an enumeration of the ways in which cryptoart world:
* Cryptoart creates artificial scarcity for digital objects, creating an “original” which can be owned
* Cryptoart recreates the some of the worst aspects of existing art markets
* Cryptoart offers no intellectual property protection and there is no regulatory structure in place to keep copyrighted materials from being minted into and sold as NFTs
* Cryptoart smart contracts offer no legal protection, and any talk of contracts baked into the NFT “requiring resales to cut in the artist” or “compensate gallery workers” depend entirely on the goodwill of the purchaser.
The rest 4500 words are a repetition of how bad it is to waste energy, woth a note at the end about how the author was "never as bored with a subject to write 5000 words about it", which to me is pretty passionate.
So this is just the author's personal gripes? "proof of state is against social justice," and "I like the non-rivalry of Internet art." No one if forcing you to use crypto art.
> Cryptoart lets a few artist early adopters get rich from a system made to reward investors, not artists.
This is true in the same way as Da Vinci pieces are expensive because Da Vinci was an "early adopter" (one of the first great artists)
If you read the title of the article or some of the opening paragraphs, you will see that it is intended to answer common questions from people who are less familiar with crypto or NFTs. This is explicitly not an issue of "someone is forcing you to use crypto art." Though you could certainly ask whether you are being forced to tolerate the environmental impacts of crypto art through things like rising temperatures, that's hard to prove trivially (the article tries)
We all have different opinions on what activities we consider "wasteful". Some people see value in cryptocurrencies while others don't. What we really need is to price externalities (e.g. carbon emissions) and let the market decide. Or we could keep posting 20 articles a day that bash about cryptocurrencies being bad for the environment.
"We" don't "need" to do anything, and are very much allowed to write all the blog posts "we" like. Promoters of the tech actually need to price externalities and whatever to improve it, if they want us to use it.
These arguments are always pointless, as there is nothing that can be done about it, short of a global ban on computers and the internet. Why not ask the question: "how can we incentivise usage of clean over dirty energy?". How is it the fault of Bitcoin that someone realised burning brown coal to create hashes is economically viable? That's a failure of the state, not the software.
No I took you to mean "country" as I'm also not American, I just don't understand how you expect governments to foresee and restrict every possible new technology that affects energy consumption to such a large degree.
I also think that these kind of insights are what would be needed for states to act on technologies that pose these threats, though I believe if regulation is applied there will be a lot, and I mean a lot, of backlash.
I’ve seen a lot of backlash in the generative art world over NFTs as a result of the revelations of their climate impact, with people refusing to participate. So these articles aren’t pointless.
It’s ironic that Bitcoin started as a way to subvert the state, but now that its externalities are clear it’s a failure of the state to control those externalities. Never mind that it would require a global carbon tax, since coins are fungible and mining will relocate to avoid having to pay the cost of its externalities.
I'm arguing from a purely practical perspective. What can be done? Can we forget PoW and Bitcoin ever existed? Can we ban someone using their GPU from performing hashes and connecting to the internet? Even the great firewall of China hasn't managed that. Can we close coal burning power stations? Yes. Let's do that then. Whether it's ironic or not, whether bitcoin was designed to subvert anything is immaterial.
I mean, people refusing to participate does move the needle a bit. I think as awareness of the problem grows (via articles like this), there will be more demand for less wasteful NFT platforms.
You're probably right that the same is not true of Bitcoin. In my experience the digital art community is less nihilistic than the Bitcoin community about climate impacts, if only because Bitcoin has had a longer time for people concerned about the climate to self-select out of the community.
> there is nothing that can be done about it, short of a global ban on computers and the internet
This is not true, there are numerous ways to discourage these harmful proof-of-work systems.
This could be done at the mining source, by states taxing this industry extremely heavily or just banning it outright, and at the point of exchange, with states heavily taxing or banning conversion between normal currency to cryptocurrency. A wealth tax (payable in real money) on cryptocurrency holdings would be another option.
If enough economically influential states decided to do this, we should see a massive crash in the price of Bitcoin and similar cryptocurrencies from this, as people realise it's not worth the hassle of dealing with under these increased regulations.
Of course there are ways to regulate it, but you cannot stop PoW as a concept from existing, nor can you stop the code from existing somewhere. So, even if one of your plans worked out, someone would git clone Doge and start again. OTOH, it's certainly possible to stop carbon being burned within a country.
Pointless in the context of Bitcoin mining, which is what we are debating. Not pointless in general. I don't own a coal mine. Or Bitcoins. Or stocks. Or much, really.
It is a failure of humanity. Just when climate change is become so obvious that basically no one takes the deniers seriously anymore, some asshole goes and invents a way to straight-up burn an ever-increasing amount of energy to power a pyramid scheme and people go mad for it.
Frankly, I'm increasingly of the opinion that we don't deserve to survive as a species.
> Ethereum “has been moving” to proof of stake for almost as long as it has existed. It has been so long that “Eth 2.0 PoS Coming Soon!” is something of a running joke.
Ethereum seems to very much be in the process is switching to proof of stake but we should ignore that because of the author's gut feeling it's a "joke"?
"Fundamentally, cryptocurrency AND cryptoart are valuable because they burn energy."
I think a better way to put this would be to say that cryptocurrency and cryptoart cannot maintain value without maintaining scarcity, which they do by burning energy. The value doesn't come from the energy burning in itself, but in the current NFT system, that energy burn is a necessary component to preserve value.
An attempt to change this would require finding a different way to produce scarcity.
The greatest irony here is that protection against socialist ideologues like the author of this article is one of the main motivations for using cryptocurrencies.
Maybe if they would fix their ideology, people wouldn't have to resort to decentralized solutions.
As for the actual content, I plainly don't trust the calculations of the anti-crypto crowd.
And while I also had lost faith in Proof of Stakes ever making it into Ethereum (unfortunately also selling all my Ethereum when I gave up on them), they have now activated the PoS chain and run it in parallel to PoW, with the goal to switch completely.
The stuff about "social justice" is also nonsense, at least with respect to mining in PoS: it is not that much Eth you need to participate, and if you don't want to invest as much, you can join a mining pool. Everybody can participate, if they want to. It is also not "unjust" if people who invest (or stake) more receive higher rewards. The opposite would be unjust.
How is it the fault of an ideology that decentralised solutions are required? Is there something inherent in Socialist ideology that you can point me to?
Socialists want to create a government that controls every detail of the citizens lives, and ensures they can not accumulate any wealth. That is a centralized threat to people's wealth.
Of course it is. Name any socialist policy that does not work towards that goal. Any policy that is not a constraint on freedom.
The motivating force behind socialism is envy. Nobody is allowed to have something that somebody else doesn't have.
Good intentions (like free healthcare or basic income or rent controls) don't prevent the inevitable outcome.
Ultimately Socialism wants to do with individual property and have everybody work for the common good, not for their personal gain. It is extremely anti-freedom, and of course anti-wealth.
You seem to be speaking of communism, not socialism.
> The motivating force behind socialism is envy. Nobody is allowed to have something that somebody else doesn't have.
You also appear to be grossly misunderstanding motivations. The general motivation is not that existing imbalance is some sort of sin, but rather that the imbalance, by nature, slides further and further out of control.
> not for their personal gain.
Arguments about working for personal gain and accumulation of wealth mean little to working class individuals that work mostly for survival and to accumulate their employer's wealth. Individuals (especially those supporting families) living paycheck to paycheck, with no financial mobility or leverage, are surely not seeing freedom in the system or even a path to get there.
Socialism and Communism amount to nearly the same thing. It is at most a gradual distinction, and neither have such hard cut definitions.
The entry on socialism starts with "social ownership". That means they want private property to go away. That means nobody will be allowed to own anything that somebody else can't have (except the political elite, of course). That leads us back to the original discussion: since socialists want to take away people's property, people try to flee into Bitcoin.
"but rather that the imbalance, by nature, slides further and further out of control"
Even if it were so, why would it bother you, as long as the people are doing well? If you do better than 20 years ago, but somebody else does even better, it bothers the socialists. That is envy.
Rich people getting richer may be an issue, but it isn't automatically true that they will swallow everything. That is more of a borderline breakdown case (one of many possible ones). It is just as unlikely as "interest" eating up the world.
"Arguments about working for personal gain and accumulation of wealth mean little to working class individuals that work mostly for survival and to accumulate their employer's wealth."
If they don't like accumulating their employer's wealth, maybe they shouldn't work for them?
Your sentence is classic, pure socialist hate speech and propaganda.
Instead of hating on employers, you should celebrate that somebody provides jobs for other people.
And if you think it can be done better, just do it. If you belief that "the government" can create better jobs, why can't people? Your belief in the government is just wishful thinking, you imagine smart people planning everything beautifully so that there is a super duper economy with everybody getting everything they want. But no such smart people exist.
My other reply was flagged (no criticism of socialism on HN, oh no).
I wanted to add:
As Wikipedia says, Socialism wants "social ownership", they want to do away with private property. That was the origin of the discussion. Since socialists want to confiscate wealth, people flee into crypto currencies, among other things.
"living paycheck to paycheck, with no financial mobility or leverage, are surely not seeing freedom in the system or even a path to get there."
So they want to instate Socialism to ensure that NOBODY has a path to freedom anymore. That is envy yet again.
If you live paycheck to paycheck, try to change your life. Under capitalism you are free to try other ways of living. Under socialism, living paycheck to paycheck, or rather food stamp to food stamp, is the only allowed way of existence.
Just for context: Argentina used about 3% of the energy consumed by the US alone in 2018. And only a fraction of that amount consumed by G8 in total. However, the number does not tell us how this energy was produced and, hence, can not provide an insight into the environmental impact of Cryptos. If it came mostly from renewable sources, the carbon footprint of Bitcoin and other cryptos would be quite reasonable, I believe.
"But climate justice must mean giving leadership and power to those who will bear the worst effects of climate catastrophe...."
I guess this claim depends on the definition of "climate justice." But if we broaden that "climate fixing" (which is how I initially took it, before going back to the original quote and noticing the word justice), what has to happen is that those in power need to care about the problem and know what to do to fix it. This can happen by putting power into the hands of those who care and know what to do and it can happen by changing the goals and know-how of those who currently have power. Neither option is easy!
Whenever anyone brings the CO2 cost of blockchain on HackerNews the comment section becomes a mental gymnastics competition filled with techbro clones of Ben Shapiro.
151 comments
[ 1.2 ms ] story [ 190 ms ] threadIs this worth looking into?
It's about how he's against the tokenization of art, which happens on the public ethereum blockchain. Tokenization brings uniqueness to digital goods, because it allows you to prove ownership if all parties involved accept the blockchain as a source of truth.
Edit: I see I am getting downvoted for simply stating facts again. Perhaps you could try and debate instead?
Downvoting without providing a reason is indeed demoralizing and toxic imho.
That's an opinion - one I tend to share - so feel free to disagree.
2. Charity: It's hard to really grok this if you don't live in the crypto world but people make insane amounts of money from Ethereum. I know multiple people who are under 30 and have each made upwards of $500,000,000 from buying ETH in the presale / insider trading in bull markets. Generally someone who bought into the ETH presale is a mega crypto bull and keeps a large percentage of their net worth in crypto. It's trivial for them to support artists by buying their artwork for a minuscule fraction of the money they've made. What sounds like "buying a .jpg for thousands of dollars" to someone not in this world, is more like the crypto equivalent of tipping a live streamer a bit on twitch.
Second of all - why do people pay more for a limited edition print than a normal print?
Why not buy Bitcoins instead? I think it has to do with the cool factor. It feels probably better to own an NFT than a Bitcoin, as it feels different to own actual art than stock in the Coca-Cola company.
(I can only guess though, I have never owned any of those.)
* https://www.crozier.ch/en/services/art-storage
Well...no. Quite the opposite. The art is an asset. NFTs are not the artwork, and they're not a deed to the artwork. Buying an NFT gives you ownership of the NFT; it doesn't give you ownership of the artwork.
Selling digital unfakeable deeds to an artwork, and trading those deeds on the blockchain, sounds really cool. That might have value! But to the best of my knowledge, nobody has done that, largely because it's utterly impossible and we have no idea how to even go about trying to do it. And in any case, NFTs certainly aren't that. You're not buying and selling the artwork, you're buying and selling a numbered acknowledgement that the artwork exists.
- .pngs are you're 8 year old self may have left in your parents windows MyDocuments folder,
- scratch files your 14 year old self made at VFX camp
- any unused game assets that you have made for Unity/Godot
e.g. http://cryptoart.wtf/#https://superrare.co/artwork-v2/spheri...
(assign a GPT3 generated phrase, being fed some texts from the cubism,dada era (duchamp, picasso etc...) )
make 400$!
This thing is gonna get flooded
And I'm sitting on Marcel Duchamp's toilet chuckling to myself.
I always enjoy the few people like yourself who call it like it actually is.
If you are worried about the environmental impact (which for 1 minting is fairly small) just use the PoS options available today and rant about ETH generally using PoW instead.
The article makes specific claims to the contrary
> just use the PoS options available today
Does PoS actually work today? AFAICS it's vaporware.
Yes. PoS chains using real practical byzantine fault tolerance like Cosmos Hub, using Tendermint consensus, have been running since 2018.
Which are unsubstantiated. One minting is basically one (largish) transaction. Transactions arent quite that expensive, it costs maybe $50-100 and you definitely don't put months of electricity to earn that little as a miner. I don't have the numbers but it doesn't check out.
>Does PoS actually work today? AFAICS it's vaporware.
Yes, it's worked for a while.
It's been coming soon on ETH. Again, you can use PoS options today outside of ETH. Tezos is a popular one, and even the biggest ETH marketplace (opensea) is adding Tezos as an option right now.
I'm not making _any_ claim about the worthiness/sustainability of the platform, just that it is what is being used. The list of "communities" on the Flow landing page suggests that it's being considered for a couple of high-profile platforms.
> today when you sell crypto art it's PoW.
I think more specifically when you sell crypto art on a platform that uses PoW, which makes this sentence a truism.
The author addresses the existence of Po[X]:
""" I’m sure you’re seeing the problem here- there is not a schema that doesn’t reward those who already are already wealthy, who are already bought in, who already have excess capital or access to outsized computational power. Almost universally they grant power to the already powerful.
This is also a climate issue. """
When the value of crypto is high, large amounts of economic output are funneled into crypto at the expense of other opportunities. NVidia expects supply shortages of its newest line of video cards (released in December and going for $1500+ on eBay from an MSRP of $700) to extend into 2022. Oh yeah, and this happens every time a new generation of chips is released. Hope you didn’t need any to train ML models.
I started out mining BTC on a Core2Duo laptop from 2006, in 2010. I upgraded to a Butterfly Labs Jalapeno miner. Then I started to realize Chinese miners were soaking up the mining equipment and many of them were getting industrial power rates.
Then people who couldn't afford / acquire BTC ASIC miners made more ridiculous alt-coins that they could mine with GPUs. Cryptocurrency isn't the problem, people butthurt about missing out and wanting to make their own coin are the problem.
This is part of the story, the other part would be central banks printing money nonstop, or in common parlance, "money printer go brrr".
Bitcoin can only exist in a post-2008-financial-crash world. Prior to that, there was no reason to consider anything other than the US Dollar. Bitcoin, however, is a solution to only one part of an overarching problem, or at least this is what I think: financial services need to be reigned back in if we have any hope as a species of surviving. Continued worldwide crashes caused by financiers engaging in riskier and riskier behavior in the name of enormous profits will eventually result in a war when one of the nations on the "losing end" decides they've had enough.
Also, NFTs are generally based on Ethereum, not Bitcoin. Did you read the article?
Name a single thing we produce with Bitcoin.
I have it on good authority that owning bitcoin gives people a very similar kind of feeling and there is nothing wrong with that. humans doing human things.
of course now there's plenty of arbiters of what constitutes proper warm fuzziness, and apparently a new BMW made from aluminium and steel is AAA+, but buying 0.1 of a bitcoin is not.
We think of them as having _other benefits_ besides environmental costs, but is this true? Is it better to travel far away to enjoy nature and a magnificent view, or to have the patience to look at things living in your own backyard for example?
Unless these things are being used as status symbols, or the person in question is actively attempting to destroy the environment, there must be some other benefit. Indeed, I certainly don't consider environmental cost to be a "benefit".
My "big petrol car" (which isn't really so big; more of a mid-sized coupe, but I digress) gives me the following benefits:
- "Warm fuzzy feeling" (the rumble, the hum, the traditional construction, etc).
- Plenty of power when I want it
- A traditional, relatively simple design that I understand; when something breaks or needs maintenance I can generally fix it. Some electronics, but not riddled with it throughout every system as today's vehicles are.
> Is it better to travel far away to enjoy nature and a magnificent view, or to have the patience to look at things living in your own backyard for example?
Well, not everybody has much of a backyard to speak of; however...
I would say that both are good. I don't get to travel much. Once every couple of years if I'm lucky. I wish I could more often. I probably won't even see most of my own country in my lifetime, let alone the wider world, and that... seems something of a shame. To imply that this feeling is somehow connected to the environmental cost of travel, well... seems a bit off.
Internet arguments about Bitcoin?
If can start on the agreement that we need to curb our environmental impact, then any new technology we embrace surely needs to be very useful to as many people as possible in order to justify any significant affect on the environment.
And just to be clear: Bitcoin is a bit more pushback than, say, residential heating, because it’s an entirely new CO2-emitting industry, and it is neither necessary nor beneficial except maybe for the thin slice of humanity that spends too much time on Reddit.
In other industries carbon emissions are an issue too, but at least there are people trying to bring energy use down with technology. Bitcoin’s difficulty mechanism nullifies any such attempts.
This is not correct. About 1 block is mined every 10 minutes, while block rewards decrease over time.
The one block per 10 minutes is also what is kept stable, and the reason mining difficulty increases over time. There is nothing in BTC mandating the difficulty to increase, and indeed it does decrease sometimes.
Most of the mining happening in China, for instance, is happening near non-CO2 emitting plants (hydropower, wind) where energy is virtually free most of the time. The increased demand for energy that is otherwise of little value may in fact be financing a rollout for renewable energy. The primary problem with renewables like wind power today is not production capacity, it is storage.
It stands to reason that at least some mining temporarily leads to increased CO2 emissions due to revenue exceeding the cost of fossil fuels. However, this only happens in the short term, because of difficulty adjusting revenue to the point where only the very cheapest energy sources remain competitive, and these are not fossil fuels. Furthermore, the increased demand for more efficient semiconductors finances the R&D required to lower the power usage of all computing into the indefinite future.
Also, the green power generation requires the manufacturing and distribution of things like solar panels, which is not currently CO2-neutral and has other environmental impacts.
There are also theoretical (if not real) limits to how much you can actually expand grid capacity. Mining already even in conservative estimates consumes a lot of power, and unless PoS is fully rolled out it will continue to consume more and more, which will put increasing strain on local power grids.
The post you were replying to is disagreeing with this. Power made available for extremely low cost next door to a hydroelectric dam etc. might be technically "on the grid" in that there is some connection between that town and the rest of the grid, but if the long-distance transmission lines are already at maximum capacity (which is usually the case, otherwise power wouldn't be any cheaper in those towns than anywhere else) then that surplus power is de facto not available to the rest of the grid.
Not necessarily in the sense of having their own physical wire, but if the path from the power generation facility to where the mining is taking place doesn't take up any long-distance transmission capacity (which is why power in those towns is cheap) then it's de facto the same thing.
> there's still a huge amount of mining that would by necessity have to happen on the grid. If consumers or small-time business owners get involved in crypto they have no choice but to use the grid.
If they want to participate as full nodes, sure. Maybe they shouldn't. And even if they are, they're going to be an insignificant fraction of mining volume.
This is a hypothesis, but where is the evidence, i.e. actually increased CO2 emissions? My argument is that most of this mining is using electricity that would otherwise not be used or produced. That is why it is so cheap in the first place.
If the power was literally not being used the cost would be negative - this is a real thing that happens. If it costs you more than $0/kWH you are creating demand and potentially increasing CO2 emissions.
That isn't really related. Like I said, it's possible the temporary spikes in prices can make mining with fossil fuels profitable, but that is in the short term.
> If the power was literally not being used the cost would be negative - this is a real thing that happens.
Price only goes negative when there is too much energy produced, but downregulating production would be even more expensive. This is mostly a problem with wind energy combined with coal or nuclear plants. Otherwise you would downregulate production so you don't have to pay the penalty. Consuming this excess energy in a profitable manner would keep prices above zero.
That’s the funny thing about this genre of arguments (Bitcoin improves GPU tech; Bitcoin subsidizes clean energy) — even if true, the gains will only be realized if there’s a crypto price crash, since otherwise mining absorbs the gains that it is responsible for by definition.
Similarly, one can point out all the advances that the Apollo program brought that are unrelated to space travel. COVID brought in lots of scientific insights that will bear fruit regardless of whether we have to deal with any other coronaviruses in the future.
The broken window fallacy does not consider the benefits from improvements of technology that may result from destruction. Suppose that smashing a bunch of windows would lead to permanent improvements in glassmaking efficiency. In that case, the benefits in the long run would far outweigh the short term costs. Of course, that's not a given with any form of destruction, but I am arguing that it is the case with cryptocurrency.
Like I said, not all destruction is destined to create excess value, but some destruction is, and I am arguing that this is the case here specifically. A counterfactual where this money would've been spent on something even more beneficial doesn't really matter. It wasn't spent that way and it could also have been spent in numerous other ways that are even less beneficial.
I think the opposite is true. Now that we have cheap GPU accelerators, the machine learning revolution is taking place. But where does that cheap GPU accelerator come from? Clearly, the more frivolous "gaming demand" was paving the way for machine learning, not the other way around. It's similar for mining.
> All the crypto boom did is create shortages and raise prices.
Rising prices are a signal to the market that production needs to be increased, which lowers prices in the long term. Shortages are short term.
A few minutes with Wikipedia and a calculator would also lead to the conclusion that transmission losses in the worst case of having to transmit the power the longest straight line within Chinese borders are somewhere between 5 and 10 %.
1. If you are the Communist party and you are planning electricity for a 5M inhabitants city in 2007, growing at 9% (doubling every ~7 years, electricity use is highly correlated with economic growth), you need to make the plants 10 times bigger than needed for them to last 20 years
2. Mining equipment is placed next to the source of electricity
3. Corrupt officials are co-opted (just turn on that turbine that is wasted working capacity for you, and I'll pay you in cash)
4. Profit?
FWIW, I think this doesn't happen exclusively in China but in every place where there's idle energy capture potential.
https://arstechnica.com/information-technology/2018/09/const...
Now I'm imagining a crypto currency that just gets awarded randomly to any person on the planet in a world-wide lottery. Or it could get distributed evenly like UBI to everyone.
Are you seriously asking how having the value distributed out to a large number of people could ever have utility without oligarchs to "set the value" to some "proper" value?
If you devise a way to have a proveably fair worldwide lottery for every human on the planet at essentially zero cost to each participant, in a decentralized network, I think you would will win a Turing at least if not a Nobel, aside from making billions of dollars.
You need a random oracle that outputs a value that maps 1:1 to a human in the world, probably without any form of pre-registration, because any registration function can be reused by the same human multiple times.
Basically a decentralized technology that can identify souls on the planet and randomly select them in a Byzantine fault environment. As of today, entirely indistinguishable from magic.
Of course it’s possible to do with a centralized registration system, but building and deploying such a tracking system IMO is akin to a war crime.
Imagine you did that, everybody has 1 UniversalToken every newborn gets one (and people are absolutely not killing they own children for personal gain as it was done throughout the human history, I diverge). And by yet another miracle this token has some value.
You know exactly what those struggling financially do with that token right away. Food is better than tokens.
You also know who will buy it.
Thy system self-"corrects" itself right away.
I've been thinking about it for some time. Fiat system is flawed, it literally takes money away from the bottom and puts it at the top (inflations + being able to diversify outside cash + loans + bailouts). But even the most perfect forms of money seem to have inherent unfairness in them. Money makes money. Having time to research possible investments, having money to do them, being able to afford risk, liquidity that allow you to avoid loans (unless you want to use them for leverage) etc. At least as long as people sell their time which seems like the foreseeable future.
If you were hoping for me to offer some solution I have none.
<daydreaming> But on the long enough run (if we have one) I think money will become irrelevant and our society will be more like a single organism. A shift in entity and entities mindset to be more oriented towards information processing and achieving specific goals / playing specific role and less driven by the limbic system which now can be satisfied at will if still present. I mean, it sounds mooshy wooshy, but look around your lucky good coders bubble. I think money is already losing value for those who don't worry about basic needs (while of course still being solution to 95% of problems for those less lucky, which seems great to remember).
In more strict terms, the only valuable thing on the long run is information. I hope for some well-grounded disagreement on that.
That being said, this has been done, but usually off the backs of existing blockchains. In Etheriumland this is known as an "airdrop" and is considered a form of annoying spam these days. Of course, if you actually wanted a wallet full of no-name ICOs you could just send coins back and forth to yourself to keep your address on the blockchain so that you got more airdrops. This is bounded mainly by gas price (which is artificially made scarce through protocol limits), but I wouldn't consider this system robust or equitable.
> Digital files also require power to access and maintain, and are incredibly unstable over time as new operating systems, plugins and standards render things unviewable- often within a decade. They are also vulnerable to bitrot and physical degradation of storage media- the stable shelf life of a CD-ROM, for instance, is less than 20 years.
This is pretty much nonsense. The actual artwork on a piece of paper will typically be lower fidelity than a digital version of it, and paper degrades faster than CD-roms. I've dug out a CD full of photos that spent 10 years in a damp attic, and the photos are as good as the day they were taken - try that with photos printed on physical paper. Furthemore, while an NFT is by design not copyable in some sense, it's certainly not vulnerable to degradation of physical media.
For physical medium, given the right storage conditions, you can store film for quite a while, and that technically has infinite resolution in comparison to a digital copy.
I think the post does a nice job of countering this; a physical object will always contain much more information (in the Shannonian sense) than any digital alternative could, and that goes far beyond things like DPI.
I don't know your definition of fidelity, but a paper artwork is full of details and a digital capture of it will loss information. Consider the tridimensional nature of real paper and paints, or the infinite interplay between light and medium. You can't capture any of that information in a digital copy.
Also, the argument about longevity is not that clear cut. We can see paintings in cave walls from thousands of years ago, same with stone carvings. Let's see if you can render a JPG 10.000 years from now. (without having to reconvert/maintain it each epoch)
The solution to proof of work using too much energy is not proof of work. It's fractional reserve bitcoins / ethereum / etc.
To explain:
For game theoretic / economic reasons, people will spend as much effort mining as there are mining rewards to be claimed.
If move to a system that doesn't hand out mining rewards, you still have to hand out the coins on some basis. So people will do the activity of that basis as much as there are rewards.
I will talk about bitcoin for simplicity.
It behaves very much like gold in a lot of respects.
If bitcoin sees wider adoption as cash, that means it will have to support a larger amount of spending in real terms and also a larger demand for real balances held in 'cash'.
Since the total nominal amount of bitcoins is fixed, you can only get the latter via an increase in the real value of each bitcoin.
But, here's the solution: gold was (and is) also hard to mine, but even when gold was money, you didn't actually need physical gold coins to serve most of your cash needs.
Bank notes and 'checkable' deposits fill this very need: they allow to expand the effective money supply without needing to mine more gold. The same will work for bitcoin.
(Of course, only that the banknotes will be electronic, of course.)
We already see some signs of that eg in bitcoin futures. The only way to get investment exposure to bitcoin used to be buying physical bitcoins. But nowadays you can buy (and roll over) bitcoin futures instead.
Of course, every future needs a counter party that's taking the opposite side of that exposure.
If you think about it, that's pretty much the same thing that banks do. Selling futures is very similar to offering time deposits:
With a time deposit, the bank incurs an obligation to pay a certain amount of money later. They could hedge that obligation by just holding on to physical money, but more typically, they invest in assets like bonds and loans, and hope to be able to exchange them for money when they have to pay back the time deposit.
That's basically the same economic exposure as being short a bitcoin future and going long a bond future.
To end the long rant, even if your base currency is gold or bitcoin, you can support lots more money than that.
Contrary to the article title, 90% of the arguments exposed are just rehashing why energy waste os bad, and why we shouldn't make use of it for NFTs. 10% of the article ("the many other reasons") is a critique of the art circuit and imho, a little ranty about how hard it is to get rich from art.
The actually interesting part of the article is at the end, but its just an enumeration of the ways in which cryptoart world:
* Cryptoart creates artificial scarcity for digital objects, creating an “original” which can be owned
* Cryptoart recreates the some of the worst aspects of existing art markets
* Cryptoart offers no intellectual property protection and there is no regulatory structure in place to keep copyrighted materials from being minted into and sold as NFTs
* Cryptoart smart contracts offer no legal protection, and any talk of contracts baked into the NFT “requiring resales to cut in the artist” or “compensate gallery workers” depend entirely on the goodwill of the purchaser.
The rest 4500 words are a repetition of how bad it is to waste energy, woth a note at the end about how the author was "never as bored with a subject to write 5000 words about it", which to me is pretty passionate.
edit: formatting
> Cryptoart lets a few artist early adopters get rich from a system made to reward investors, not artists.
This is true in the same way as Da Vinci pieces are expensive because Da Vinci was an "early adopter" (one of the first great artists)
I also think that these kind of insights are what would be needed for states to act on technologies that pose these threats, though I believe if regulation is applied there will be a lot, and I mean a lot, of backlash.
It’s ironic that Bitcoin started as a way to subvert the state, but now that its externalities are clear it’s a failure of the state to control those externalities. Never mind that it would require a global carbon tax, since coins are fungible and mining will relocate to avoid having to pay the cost of its externalities.
You're probably right that the same is not true of Bitcoin. In my experience the digital art community is less nihilistic than the Bitcoin community about climate impacts, if only because Bitcoin has had a longer time for people concerned about the climate to self-select out of the community.
This is not true, there are numerous ways to discourage these harmful proof-of-work systems.
This could be done at the mining source, by states taxing this industry extremely heavily or just banning it outright, and at the point of exchange, with states heavily taxing or banning conversion between normal currency to cryptocurrency. A wealth tax (payable in real money) on cryptocurrency holdings would be another option.
If enough economically influential states decided to do this, we should see a massive crash in the price of Bitcoin and similar cryptocurrencies from this, as people realise it's not worth the hassle of dealing with under these increased regulations.
Because that would be absolutely pointless.
If energy were infinite and free, then all of this would disappear instantly.
The value of crypto is proportional to the future cost of minting. No future cost == zero present value.
You are actually arguing that it's pointless to incentivise usage of clean over dirty energy. Do you own a coal mine?
> The value of crypto is proportional to the future cost of minting. No future cost == zero present value.
This argument requires some evidence. I was under the impression that scarcity of the asset underpinned the value.
Frankly, I'm increasingly of the opinion that we don't deserve to survive as a species.
Ethereum seems to very much be in the process is switching to proof of stake but we should ignore that because of the author's gut feeling it's a "joke"?
I think a better way to put this would be to say that cryptocurrency and cryptoart cannot maintain value without maintaining scarcity, which they do by burning energy. The value doesn't come from the energy burning in itself, but in the current NFT system, that energy burn is a necessary component to preserve value. An attempt to change this would require finding a different way to produce scarcity.
Maybe if they would fix their ideology, people wouldn't have to resort to decentralized solutions.
As for the actual content, I plainly don't trust the calculations of the anti-crypto crowd.
And while I also had lost faith in Proof of Stakes ever making it into Ethereum (unfortunately also selling all my Ethereum when I gave up on them), they have now activated the PoS chain and run it in parallel to PoW, with the goal to switch completely.
The stuff about "social justice" is also nonsense, at least with respect to mining in PoS: it is not that much Eth you need to participate, and if you don't want to invest as much, you can join a mining pool. Everybody can participate, if they want to. It is also not "unjust" if people who invest (or stake) more receive higher rewards. The opposite would be unjust.
The motivating force behind socialism is envy. Nobody is allowed to have something that somebody else doesn't have.
Good intentions (like free healthcare or basic income or rent controls) don't prevent the inevitable outcome.
Ultimately Socialism wants to do with individual property and have everybody work for the common good, not for their personal gain. It is extremely anti-freedom, and of course anti-wealth.
You seem to be speaking of communism, not socialism.
> The motivating force behind socialism is envy. Nobody is allowed to have something that somebody else doesn't have.
You also appear to be grossly misunderstanding motivations. The general motivation is not that existing imbalance is some sort of sin, but rather that the imbalance, by nature, slides further and further out of control.
> not for their personal gain.
Arguments about working for personal gain and accumulation of wealth mean little to working class individuals that work mostly for survival and to accumulate their employer's wealth. Individuals (especially those supporting families) living paycheck to paycheck, with no financial mobility or leverage, are surely not seeing freedom in the system or even a path to get there.
The entry on socialism starts with "social ownership". That means they want private property to go away. That means nobody will be allowed to own anything that somebody else can't have (except the political elite, of course). That leads us back to the original discussion: since socialists want to take away people's property, people try to flee into Bitcoin.
"but rather that the imbalance, by nature, slides further and further out of control"
Even if it were so, why would it bother you, as long as the people are doing well? If you do better than 20 years ago, but somebody else does even better, it bothers the socialists. That is envy.
Rich people getting richer may be an issue, but it isn't automatically true that they will swallow everything. That is more of a borderline breakdown case (one of many possible ones). It is just as unlikely as "interest" eating up the world.
"Arguments about working for personal gain and accumulation of wealth mean little to working class individuals that work mostly for survival and to accumulate their employer's wealth."
If they don't like accumulating their employer's wealth, maybe they shouldn't work for them?
Your sentence is classic, pure socialist hate speech and propaganda.
Instead of hating on employers, you should celebrate that somebody provides jobs for other people.
And if you think it can be done better, just do it. If you belief that "the government" can create better jobs, why can't people? Your belief in the government is just wishful thinking, you imagine smart people planning everything beautifully so that there is a super duper economy with everybody getting everything they want. But no such smart people exist.
I wanted to add:
As Wikipedia says, Socialism wants "social ownership", they want to do away with private property. That was the origin of the discussion. Since socialists want to confiscate wealth, people flee into crypto currencies, among other things.
"living paycheck to paycheck, with no financial mobility or leverage, are surely not seeing freedom in the system or even a path to get there."
So they want to instate Socialism to ensure that NOBODY has a path to freedom anymore. That is envy yet again.
If you live paycheck to paycheck, try to change your life. Under capitalism you are free to try other ways of living. Under socialism, living paycheck to paycheck, or rather food stamp to food stamp, is the only allowed way of existence.
> a financial network that uses more energy than Argentina
https://en.wikipedia.org/wiki/List_of_countries_by_electrici...
Just for context: Argentina used about 3% of the energy consumed by the US alone in 2018. And only a fraction of that amount consumed by G8 in total. However, the number does not tell us how this energy was produced and, hence, can not provide an insight into the environmental impact of Cryptos. If it came mostly from renewable sources, the carbon footprint of Bitcoin and other cryptos would be quite reasonable, I believe.
I guess this claim depends on the definition of "climate justice." But if we broaden that "climate fixing" (which is how I initially took it, before going back to the original quote and noticing the word justice), what has to happen is that those in power need to care about the problem and know what to do to fix it. This can happen by putting power into the hands of those who care and know what to do and it can happen by changing the goals and know-how of those who currently have power. Neither option is easy!