"Cryptocurrency mining uses significant amounts of energy as part of the proof-of-work time-stamping scheme to add new blocks to the chain. Expanding upon previously calculated energy use patterns for mining four prominent cryptocurrencies (Bitcoin, Ethereum, Litecoin, and Monero), we estimate the per coin economic damages of air pollution emissions and associated human mortality and climate impacts of mining these cryptocurrencies in the US and China. Results indicate that in 2018, each $1 of Bitcoin value created was responsible for $0.49 in health and climate damages in the US and $0.37 in China. The similar value in China relative to the US occurs despite the extremely large disparity between the value of a statistical life estimate for the US relative to that of China. Further, with each cryptocurrency, the rising electricity requirements to produce a single coin can lead to an almost inevitable cliff of negative net social benefits, absent perpetual price increases. For example, in December 2018, our results illustrate a case (for Bitcoin) where the health and climate change 'cryptodamages' roughly match each $1 of coin value created. We close with discussion of policy implications."
PoW is wasteful as hell, but I am always skeptical of these calculations. It seems like an awfully long chain of causality to quantify. The error bars have to be huge.
Look at it this way we know that PoW is wasteful as hell and because of that causes external issues on a huge scale. If we don't try to work out what those issues are and how big their impact is how would we ever deal with them? Putting our heads in the sand won't make them go away and the link details their methodology and results if you wish to quibble with them. Particularly as it addresses estimate accuracy directly.
More generally the whole external cost of PoW is definitely a case of techno-utopianism meeting the real world and a lot of proponents wanting to put on blinkers even though this study shows that crypto-currency is currently a net social positive. Literally any indication that it has any negative outcomes elicits very strange responses.
And every cent coin created in US and some other developed countries costs more than 1 cent and promotes harmful mining operations for copper and other metals. Also copper is harmful for environment. We should stop making money altogether. /s
We should, in fact, stop making the penny, and devise plans to retire the nickel as well.
Dimes and quarters are perfectly fine. The $1 coin gets a certain amount of press by people touting it as a potential replacement to the bill, but it turns out the US $1 bill is remarkably cost-effective by paper currency standards, and should probably remain paper for the time being.
You say this sarcastically, but it's spot on! Look at Sweden: nearly completely cash-less and we sure don't do our grocery shopping with bitcoin either!
It's not for environmental reasons either: cash is just inconvenient when you think about it.
> Bob, a United Kingdom resident but frequent visitor to Sweden, said this system is difficult for non-residents.
> “As a visitor I can't pay at places that only accept Swish because I don't have Swish. And without a Swedish bank account I can't get Swish. And without a Swedish residence, I can't get a bank account,” he explained.
> Howard Drobner, who is a frequent business traveller to Sweden, also proposed a tweak.
> “Some small vendors, like at flea markets and craft shows, only take Swish which I do not have and can not get due to the fact that I do not have a Swedish bank account or national number. I would therefore really like to have a Swish setup for frequent travellers to Sweden,” he said.
Those are people with money, doing ok but inconvenienced. There are things they can't buy.
Now imagine being homeless, or an "illegal" resident. People can't even help by giving you money any more. Friends have to buy food for you themselves instead of supporting you with cash. It gets harder and harder to obtain essentials. Human rights should transcend that, and the cashless systems falling into place in Sweden do not even attempt to be available for all persons.
Third generation cryptos like Cardano/Ada, Polkadot and others using proof-of-stake instead of proof-of-work to generate new blocks are orders of magnitude less energy demanding and more efficient in terms of transaction speed and costs than bitcoin and ethereum. Bitcoin has, unfortunately, become synonymous with cryptocurrency in many people's minds. It will be interesting to see what happens with the value of bitcoin as these limitations relative to the new kids on the block (sorry, pun intended, showing myself out the door etc.) become more obvious.
> Bitcoin has, unfortunately, become synonymous with cryptocurrency in many people's minds.
This. A problem. "One" of the things has become "the thing" itself, as a whole ...
> It will be interesting to see what happens with the value of bitcoin as these limitations relative to the new kids on the block [...] become more obvious.
Will it? (become obvious)
... at least by the general public. That concerns me ...
> (sorry, pun intended, showing myself out the door etc.)
This is about the furthest thing from “science”. Just sensationalist propaganda. It’s so far from being even remotely plausible. Maybe 1 BTC is responsible for $0.49 of “damage” if you could ever actually quantify it. Most of this electricity comes from the cheapest source of power, which is hydro.
Not fully necessarily given how local energy is. There's only so many things you can do in cheap-energy places, especially without much bigger and less potentially temporary investments.
That’s not true at all. There is a huge amount of stranded power. Electricity is not fungible across large distances. Otherwise people in Texas wouldn’t be paying $9,000 per mwh during the storm— power certainly didn’t cost that much in other states then.
lol yes it is, texas is huge btw, but also has no interconnects with the rest of the grid, hence the price rise at a time of zero supply and high demand
Texas is a pretty disingenuous and cherry picked example considering they deliberately siloed themselves off from the other two major power grids of the country. Energy within a power grid is fairly fungible.
That was a political decision. Having your own grid means that you also have your own power frequency regulation, and importing power from a different network is not as simple as connecting wires - you need to connect them using DC instead of AC. These transfer points (interchanges) are sized just for temporary power import or export, you cannot use them to power the whole Texas grid. You can see more details about the interconnects here: https://www.eia.gov/realtime_grid/#/status
My initial reaction was skepticism. So the numbers I found were 121 TWhs consumed by Bitcoin annually. Hydro power produces 4200 TWhs annually of a total electricity production of 25,000 TWhs. Assuming all Bitcoin mining is powered by hydro, a 97% untilization for hydro doesn't seem far-fetched.
Yes there is a lot of power being used to mine crypto, I mine but it is done on a system that I would normally have running 24/7 regardless of mining. Yes large mining specific "server" or "ASIC" farms use alot of energy but so does every other serverfarm. Maybe we should be talking about the energy cost of watching Pr0n, or TikTok videos both of whic IMHO provide far less benifit to society.
Ugh this is such a tired argument. Energy used to watch TV could be used for something else instead. What is this mystical “something else” which couldn’t be powered because Bitcoin was using up all the electricity, and what good fortune would it have brought us?
Yes this discussion has happened hundreds of times on HN at this point.
> "Bitcoin uses too much energy[1]"
> "It's only using surplus energy which would go to waste anyway[2][3]"
> "But it still has an environmental impact [4]"
I guess I'm just tired of seeing the same things repeated on every single thread about Bitcoin. When I saw a lazy comment like OPs, I overreacted, sorry.
Your articles don't support your stance. I work with people who handle surplus electricity with mobile mining operations -- they're few and far between.
The use of bitcoin, a speculative good, as a sink for electricity creates less pressure for grids to manage electricity production (especially as the acceptable spot price trends towards the commercial price of electricity). It also ignores the innovative ideas that are geographically bound like storing potential energy by pumping water into dams.
The idea that bitcoin only uses surplus energy is disprovable just by looking at the regularity of block completion. If it were dependent on an irregular source like surplus electricity, you wouldn't see that.
So what do you propose we do? Do we create the energy police and tell people what you can and cannot do with energy? Do we stop people from mindlessly browsing the internet?
This argument really annoys me because, bitcoin has a purpose, I can buy things with bitcoin, just take a walk in Huaqiangbei and see how many shops accept bitcoin, talk to the people who's governments failed their national currency and they will agree the energy we spend on bitcoin helps them.
Until btc is replaced with a POS crypto currency like cardano[1] the energy we spend on btc is worth it for the people using it.
It assumes the value of Bitcoin is in the mining of new coins. The network also has value as a ledger to record transfers of Bitcoin (billions per day) which contributes to the value of the network
The analysis can be generalized to say anything that uses 0.05 electricity creates these large harms. Perhaps true, but it’s not going to be unique to Bitcoin
This. This bad argument about value of cryptocurrencies being mining, lack of perspective and policy proposals in the paper are the most obvious signs of bias.
For every dollar spent building a train station there are $50 dollars of health and climate damages.
This ignores the USE of the train station, and just focuses on energy costs to build it.
This study is only focused on mining new coins. Heads up, some of the (wildly inflated) value of bitcoin is tied to (arguable) uses and the ability of the blockchain to operate as a non-repudiation public ledger that allows global transfer of value with strong guarantees totally independent of any other central party.
Some quick math.
1 bitcoin is lets say worth $50,000. Let's assume $10K in electricity to mine this. So for every $1 in bitcoin, you need 20 cents of electricity.
Reduced to it's simplest, the claim here is that for every 20 cents of electricity, there is another 50 cents of health impacts.
Fair enough, but if you believe this, then a lot of other things have huge damages.
And neither is highlighting bitcoin, especially by focusing ONLY on the mining aspect of it. The use of the network is also part of the bitcoin story. If instead of using new bitcoins mined they did transaction value per day (ie, $20B+) the math would be totally different.
If you applied this same damage model to something people had fondness for (ie, driving an electric car) you'd realize we should be working as HARD as we can to kill EV cars dead, because there is a MASSIVE unaccounted for cost to charging them (using this model).
Reality though is bitcoin chases low cost power, and that is currently often actually green (hydro, excess solar during day when their is curtailment and negative pricing etc). I can't imagine the economics making sense to mine using coal power.
Because the transactional ledger of bitcoin is what is driving electricity use, and another statement might be, for every $1 transacted on the bitcoin ledger, 0.0005 dollars in health damage is caused. (it's roughly a factor of 1000 more volume then new mining, and over time new mining is going to get smaller and smaller)
This isn't whataboutism, it's a valid question considering BTC is touted as a replacement for the financial system and ostensibly performs a similar function with an alternative infrastructure. If the premise is that we should stop BTC mining and processing simply because it costs $X dollars (code pun intended) per transaction, then the price of alternatives is germane to the discussion.
The question is valid - it would be interesting to see the comparison. To get some perspective as to how big of a problem cryptocurrency consumption really is.
No, without those miners, the energy supply wouldn't have increased in the first place. In the energy market, demand drives supply, not the other way around. It's very uncommon to spend money on converting energy supply from coal/gas to other sources, as it doesn't make sense in terms of money for the companies. Instead they focus on creating new supply with renewables.
No, organizations built hydro plants for whatever reason in places where supply ended up higher than demand, driving down the prices. With that move, Bitcoin miners saw the opportunity and placed themselves within that ecosystem.
Bitcoin miners don't put their operations in the middle of nowhere and then ask someone to build hydro plants...
Your counter is just as flawed as you have no way to verify any miners are using renewables. Power transmission is a thing (California does it) and if we weren’t using the power to mine BTC it could be used to power other things. Again, people are only arguing for BTC on this site because it’s hacker news, nothing else.
You can of course believe whatever seems easy to you, but you do realize that I linked to a published study that says miners are using renewables far more than the US does on average, don't you?
That's not how it works. If I claim the moon is made of cheese and someone says he doesn't believe me, the onus is on me to prove it is, not on them that it isn't.
Their research indicates that a minority of mining is done using renewable resources:
> The survey findings estimate that on average 39% of proof-of-work mining is powered by renewable
energy, primarily hydroelectric energy.
It also specifically addresses this popular claim of mining being powered mostly by renewables:
> China’s oversupply of hydroelectric
energy during the rainy season has often been used as evidence in claims that a vast majority of mining
is powered by environment-friendly power sources. While it is true that the Chinese government’s strategy to ensure energy self-sufficiency has led to the development of massive hydropower capacity, the same strategy has driven public investments in the construction of large-scale coal mines. Like hydroelectric power plants, these coal power plants often generate surpluses. It should not come as a surprise then
that a significant share of hashers in the region equally report using both hydropower and coal energy to power their operations.
The article seems to use the country average emissions per kWh for the US and China (it's hard to tell because the first reference is a 404, the other is 400+ pages, the final one is definitely country average numbers).
A cursory Google search says the percentage of renewable energy in the US and China is ~11% and ~23% respectively. The disparity between that and an average of 39% for crypto mining specifically does not seem to be factored in.
I think you're right, they do note this as a limitation of their study due to insufficient data:
> The great unanswered question faced when exploring cryptodamages is that while we can identify select geographic hotspots of production we currently do not know in the aggregate where the electricity used in cryptocurrency mining is physically produced. This
is because we, like Krause and Tolaymat, do not know the
physical locations of cryptocurrency miners, whether individuals, groups or aggregates in, say, a region or country. There is considerable evidence of concentration of mining operations in particular locations, typically where reliable electricity is cheaply available, though, precise data are lacking. In the US, perhaps the most well-known concentration is the Mid-Columbia Basin area in
central and eastern Washington State, where cheap electricity is produced by hydropower along the Columbia River, however, mining in other US locations also occurs. There is also evidence of large
mining camps in China. With time and emergent research there may be improved information about the amounts of electricity devoted to mining cryptocurrencies for particular locations or regions, but it is currently not available.
It would be interesting to see the results of their analysis if recalculated using the more granular CCAF survey data.
Maybe in the beginning but today miners make lots of choices about where to build/expand their operations based on energy costs, government policies, energy source and more.
Patently false. I do a lot of contracting work for miners, they specifically tune their operations to the power cost of an area and in variable rate loads will switch off miners during peak costs. $/kWh is a big concern for actual mining operations, maybe not for people with one or two rigs in their basement.
Selection bias. I don't doubt that the miners who are investing god knows how much is necessary to _require a contractor_ will have scaled enough to need to concern themselves with cost of electricity, but the _majority_ of miners are not going to be those people, surely?
Requiring a contractor isn't a big ask. All it takes is not knowing someone who has networking chops. I work regularly with around 10 mining operations, 8 of them explicitly relocated to get on hydro because of how inexpensive it is. These guys care deeply about getting the most kWh for their money, because they still have to deal with turning a profit, and anyone who doesn't understand that has not actually dealt with real Bitcoin mining operations.
For some reason I imagine that you are not managing e.g. Chinese mining operations.
Everyone will look for cheapest power, but that on its own does not make it renewable.
Plus, regardless of your source, as long as you haven't built your own plant, the grid has to cover for the loss. If there isn't an abundance of renewable energy on the grid, then the operation wasn't neutral at all.
You're correct, I'm dealing with exclusively American operations or American operations run by foreign entities. Most have relocated to explicitly get onto hydro. YMMV, but that's been my experience.
Not true. We have actively sought the cheapest electricity sources for our rigs. I guess it depends on the scale you're operating at, but you're not going to be too profitable plugging into your apartment wall socket here in Central London @ 20p/kWh!
This is not true. Miners are sophisticated business enterprises that select mining farm locations carefully based on access to cheap power and natural cooling. People signing their gaming rig into the network aren't a factor.
> This is not true. Miners are sophisticated business enterprises that select mining farm locations carefully based on access to cheap power and natural cooling.
Bitcoiners use the cheapest energy they can find in place where they can cheaply install hash power.
Some of that may be hydro. A lot is coal.
Even when they do use green energy, the effect of doing that is to displace other users onto dirtier forms of energy, thus creating just as much pollution anyway.
Bitcoin is not green in any way whatsoever. Bitcoin specifically wastes energy, by design. This is never green. The first principle of green energy is to use less energy, as no energy is clean.
This is just not true in the vast majority of cases.
"Surplus energy" is another lie bitcoiners like to spread about this. Sure, there might be a few occasions where bitcoin mining might use surplus energy.
In the vast majority of cases, no, they are not doing that. That is just not a thing.
Cheap is not necessarily renewable, but is often just a cheaper country which in turn tend to be more lenient.
Also, it is wrong to assume that consuming 1GW near a hydroplant is fine. That 1GW would have been sold to someone else, and unless the net has an abundance of renewable energy, a non-renewable plant is going to have to cover for that.
Which might be a good reason why not every single Bitcoin miner is using hydro. If the expected payoff of mining is big enough to outweigh the increased prices of GPUs and nonrenewable energy, then I might choose not to move my setup to be next to a dam.
The same market effects that apply to factories, research facilities, server farms, etc... also apply to cryptocurrency mining. We can't have our cake and eat it too -- if energy isn't fungible, then not every mining rig is going to be set up using the most efficient power source in the world. Not every miner is going to have the ability to just "choose" to use cheap renewable power, and if mining is still profitable where they are using the power sources available to them, then they're still going to do it.
It's better and cheaper to use locally, but unless you find a plant that is unable to sell capacity, you're taking it from something else.
True, it doesn't make sense to move the power all the way around the world, but that's also not really how things like the synchronous grid of Continental Europe works, where power is traded across 24 countries on a single grid.
If your have cheap renewable energy, when you start selling, excess non-renewable capacity and more expensive plants in general powers down in nearby areas and countries.
Any power taken from a renewable plant there when power price is positive means increased non-renewable output.
> or do you claim that miners choose to use power in more expensive locations?
Both scenarios are very plausible, because if everyone within the market was perfectly efficient in choosing to use the cheapest power sources available, and if hydro was clearly the cheapest way to generate power, then it wouldn't just be being used for Bitcoin, it would be being used for every single portable, power-intensive task in general. We wouldn't be having a conversation about the environment in nearly any manufacturing field.
Given that this isn't happening, given that some things in the world still use coal power, and given that people are still worried about the environmnetal impacts of energy use in general, even though hydro exists -- the obvious conclusion is one of the following:
A) hydro isn't universally the cheapest power source.
B) there are other factors that determine where people will set up operations (taxes, living situation and preferred environment, costs beyond power generation, market saturation to the point that its still profitable to use expensive sources of power).
C) there are still environmental impacts of using a ton of power, even if it came from hydro, and hydro power doesn't just have zero environmental impact.
But obviously something is going on here, because bitcoin isn't special. If hydro power was the savior of power generation, then every single factory in the world would already be using it. But they're not, and it's reasonable to assume that the same market constraints and environmental situations also apply to bitcoin mining.
The fact that we are having an energy debate at all about any industry implies that something about the energy market, it's pricing, and its environmental impacts is more complicated than you're making it sound.
There are different articles which claim different things. I think the first article is the best.
> The CCAF’s research finds that 76% of ‘hashers’ use renewable energy to power their activities, with hydropower the number one source at 62%. Wind and solar energy meanwhile are used by 17% and 15% respectively. This would appear to be consistent with previous research which estimates that 74% of bitcoins are mined using renewable energy. However, the CCAF’s report specifies that the 76% refers to the share of hashers who use renewable energy at any point. It estimates that only 39% of hashing’s total energy consumption comes from renewables. [1]
> Bitcoin, which is mostly mined with electricity from coal.[2]
> But most bitcoin mining facilities are located in China, which is still heavily reliant on coal-based power. Though the Chinese province of Sichuan is known to attract miners due to its cheap electricity and rich hydropower resources, the level of power generation capacity fluctuates depending on the season. [3]
Did you read the article, or just the abstract? Do you have any specific points to refute or insights to add? Or is your comment not constructive and just sensationalist propaganda? And I ask this as someone who would benefit from BTC going up relative to USD.
> If crypto uses green energy, it displaces other users to use more dirty energy.
"I bought a solar panel and AC converter to consume less from the grid. Oops, because of that now I am displacing my neighbours to use more dirty energy. How silly of me."
Seriously your argument makes no sense. How does one minor consumer of green energy displace you from doing the same?
Bitcoin mining facilities do not install their own solar panels. They use energy from the grid, that would otherwise go to other users if bitcoin miners did not destroy it.
Why is such as a man-made change necessarily net negative impact on the planet? It may have both negative and positive impacts. Maybe the new dam allows other species to migrate in and increase diversity. It is complicated, depends on circumstances etc.
Even if this were true, hydro also has an environmental cost, doubly so if the demand from crypto is causing hydro to be constructed in places where it cannot be used for other purposes (which is often a linked claim).
Doesn’t this speak mostly to the US not cleaning up their grid? Obviously the huge amount of wasted energy going into Bitcoin is insane, but it wouldn’t cause health issues if it was all nuclear, wind, solar, etc.
The US is actually a tiny portion of the hash rate in the BTC network. China makes up 70%+ of the hash rate of the network and they use a lot of coal power, ~62% of their power generation is handled by coal power.
Basically no where is to the point we can just add power draws and say they have no health impact. Energy being fungible until an grid is to the point of having excess renewable power during the day and miners being spun up and down to absorb that excess any mining will have health impacts. I think the spin up and down is important too because it means over night miners aren't causing excess capacity to be built for storage.
BTC has surged which leads to a general interest in the topic. People looking for clicks try and figure out new ways to talk about the subject using whichever lens suits their agenda/objective and their audiences interests/convictions.
Nothing special - that’s the problem. I consider a good HN post one where I learn something from the post and the discussion underneath it. Crypto posts for me at least typically don’t bring me learning from either. Discussions tend to all be along pretty similar patterns - either you’re pro or against. If pro, you talk about decentralization and money transfer in developing countries, if con about energy usage and criminal activity. Not that interesting
There seems to be some sort of smear campaign to smear cryptocurrencies as anti-green anti-environmental
Which is a bit absurd as you can pick anything in modern world, literally anything such as computers/phones in front of us reading this and point that XYZ damage was caused to the planet by the shiny macbook in front of us or android phone, not to mention the huge network of datacenters around the world from which the information is stored/streamed.
Until there is highly efficient zero loss superconductor long range networks of several orders of magnitude better energy storage then saying that energy "is wasted" on crypto is very misleading, that energy could be coming from a dam up in a mountain enjoying a sudden influx of rain or windmills/solar in middle of nowhere with no nearby large population centers to absorb this energy (lack of efficient long range transmission infrastructure and/or energy storage).
the petrodollar system is built on US military hegemony, with that military being the largest fossil fuel consuming entity in the largest fossil fuel consuming nation -- "the largest single institutional consumer of hydrocarbons in the world"[1], towards the end of making sure people buy oil with dollars. in a very real sense the value of the dollar is maintained by the fact that people have to buy oil with it.
crypto is at least agnostic about what kind of energy you convert into it, and literally incentivizes renewables.
And social media datacenters that are ruining democracy, causing thousands of suicides per year, using far more power, and causing plenty of mental illnesses/depression.
And I'm especially angry at hypocrites like Elon Musk who are profiting from climate change and then proceeds invest those profits in bitcoin that accelerates climate change.
If you were sitting on billions and wanted to accelerate climate change then investing in BTC is probably the most inefficient way to do that. I doubt that idea ever even crossed his mind. It’s just about the profit.
I'm not saying Elon's a supervillain, more of a wasted talent (so far). The non-solutions he presents to non-problems are weird to say the least. Hand on heart, do we really need space tourism and luxury cars affordable by wealthy middle-aged men? How does this contribute to a better society?
Returning to the point at hand, both EV's and blockchain are non-solutions to difficult (and valid) problems. In my view, centralized money and climate change can only be only effectively solved at the origin and not the consumer level.
The solutions offered are annoyingly superficial, like taking away our drinking straws and fake internet money that has no use other than to make more centralized money.
That's exactly how I understood the parent: Musk goes after anything that brings profits, and doesn't care about climate. Neither acceleration or deceleration.
Bitcoins adoption leads to climate change acceleration. Therefore, profiting from bitcoins means profiting, indirectly, from acceleration.
I'm only trying to explain to you how I understand the original post, and it has nothing to do with my own opinion on the subject (which may/or may not be the same).
But then none of his enterprises have been explicitly exploitative, unlike many billionaires, and he’s pushed the car industry into moving away from combustion engines, so personally I give him a pass
The US spends a lot of $ on waging war, $ that could have been spend on Healthcare, or funding initiatives that help combat climate change. I'm saying Healthcare and climate are hardly a priority for the US, so why is BTC the bad guy here?
Bitcoin takes away the power of central banks to fund wars willy nilly. All the corrupt forces that suck at the teat of free money will coalesce around the protection of this debasement racket and so we get these "think of the kids needing energy" articles...
What is wrong with search for some comparisons and perspective? Everything has externalities, let's compare them to see how big of an elephant this really is.
Nothing's wrong with it. But the fact that this paper looks at a specific different piece of the puzzle doesn't make it bad. You're just asking for an entirely different piece of research, and criticizing this even though it's a step toward being able to make that comparison.
So in that sense, Bitcoin generated a net gain of $0.40 of planetary wealth for every dollar mined. Obviously, we should put as many resources into cryptocurrency as possible - we'll finally raise the money to eliminate climate change!
Not precise enough. Power usage is proportional to block reward USD value, which is proportional to BTC value. But once in 4 years number of BTC awarded for mining a block is halved.
The difficulty is that the increasing dollar value of Bitcoin incentivises more mining activity (even though no additional coins will be produced as a result), so energy use is almost directly correlated with the price, at least in the medium term.
Fortunately as the block mining reward continues to be halved approximately every four years, the incentive to mine will decrease as well (though not quite as much, because miners also receive transaction fees).
Still has usage as a potential store of value and a means of cheap global transfers. My mother in law use it monthly to transfer money to her home (third world) country, which is crazy easy and cheap compared to traditional means.
I can rent a moving truck to get groceries, but that doesn't mean it's a good idea. There might be narrow use cases, but that doesn't mean it's the best realistic way to solve every problem, and it doesn't mean it's worth the cost.
I hear what you're saying, but it's not nearly as "narrow" as you suggest. Remittances from the United States total hundreds of billions of US dollars each year [1]. Even with what I feel are bloated fees associated with Bitcoin, it is vastly cheaper than other services like Western Union.
The concern here is power use vs. utility relative to other options, not price. By cost I meant the cost under discussion: environmental and health. How much energy do remittance services use to move an equivalent amount of money? What about the cost to health and the environment?
The utility isn't solely measured by the amount of money a financial service can move, or the amount of transactions it can process.
If that were true, Western Union would obviously have less utility than Visa. But actually, WU and Visa solve totally different problems with different risks associated, so it doesn't make sense to compare them in that way.
Any legitimate use of cryptocurrency will never materialize as long as people are gambling with them.
The intrinsic value of Bitcoin is nowhere near the current price. When the speculators all sell and the only demand comes from people looking to actually use them, the price will drop by a lot.
But, when that happens, the speculators/grifters will simply move to another coin. That other coin will see a similar bubble, and bitcoin’s value will drop even further as people perceive it as “dead” or worthless (as maybe it should have always been perceived)
So until this shit gets under control somehow, cryptocurrency is going to remain the exclusive domain of the speculator/gambler/criminal/grifter/gullible. And of course, the world will suffer increased energy usage, pollution, and GPU shortages.
Cryptocurrencies and their markets are anarcho-capitalist by design and intent. The entire premise of crypto is that only the free market determines legitimacy through profit and market share.
If gamblers and thieves dominate the crypto market and cannot be outcompeted by honest actors then by definition the market has decided it prefers gamblers and thieves to honest actors. If someone wants an economy with rules other than "lol Caveat Emptor" they shouldn't get into crypto.
Increased amounts of speculation actually in theory should decrease volatility and bring the price to the fair value more quickly.
What I think you are not considering here is that you can speculate both on the upside or the downside. Speculators are only trying to predict the future price, speculation is not the same as a "pump and dump scheme".
> When the speculators all sell and the only demand comes from people looking to actually use them, the price will drop by a lot. ... bitcoin’s value will drop even further as people perceive it as “dead” or worthless (as maybe it should have always been perceived)
Like you said yourself, if it is true that Bitcoin is overvalued then it would be a good thing for every Bitcoin user if its price dropped to the fair value. Why are you describing that situation like a bad thing here? I expect users would be happy that they can now afford more of the coin for practical use cases, and adoption in those use cases would probably go up more than anything.
Please stop those myths - cheap global transfers is not something that needs cryptocurrencies for it to happen, this can and will work within the current rails.
Absolutely not. Bitcoin’s value increases because it’s a speculative asset and there’s almost zero reasons for it to go down since it’s not really tied to anything tangible.
Well, there's at least one speculator (myself) who is also using BTC as a hedge against an uncertain petrodollar. Metals and volatility funds also are purely speculative assets - risk mitigation itself is tangible value.
Simply take a moment to see how that argument works with other kinds of assets and you will see how it doesn't make any sense.
Gold is a speculative asset that also has some limited tangible uses too. So does that mean gold has less reasons to decrease in price than an asset which only has tangible uses and no speculation?
Try it for certain vintages of fine wine. The same as Bitcoin. Over time the quantity available for sale decreases due to loss. People lose their keys and the coins get lost. People drink the wine. Both naturally reduces supply driving up the price of the remainder.
BTC is a one way bet, right up to the point where people decide it isn't worth holding any more. Just like certain vintages of wine.
Sure, the fair value might slowly climb over time due to losses, but that has nothing to do with the fact that it's the target of a lot of speculation.
The fact that there is some small rate of losses doesn't significantly impact the amount of downside speculation you'd expect.
Cryptobots really believe this? Even as a European citizen, I have faith that the US Dollar will stay the US dollar, and keep value. The Euro will keep being the Euro. Hell, even the Yuan will stay the Yuan.
Just accept that you're willing to shit on the planet to make a few bucks, it's fine.
That's... called printing money. Inflation is a necessary evil and infinitely more preferable to the alternative that is bitcoin, which gives you no reason to ever use it. Why would you use it at 10k when it's going to be a 20k next month ?
Inflation encourages money changing hands. The market has absolutely fuck all to do with it.
Your $100 today will still be usable in 20 years. Sure, it'll have lost you a bit of purchasing power, but it'll still be backed by an actual nation, have its value recognized everywhere in the world.
Your bitcoin will have gone sideways three times, jumped up and down. Could be tripled. Could be halved. Still controlled by three chinese farms who could double spend at any point should it become less valuable.
As European citizen I don't really trust the Euros or Dollars. Just think about the loss in value If you own money. Even if the official 2% inflation, its still 2% lost of value. And now with Corona they printing billions of Euros and the inlfation will stay at 2% ... sure.
The whole point of inflation is that your money is actually used to do things. Were those currencies to deflate, it would literally be more beneficial to not touch them. Ever. Investments would grind down to a halt, and why would you do groceries now when you could get more if you waited for next week ?
Even as a hardcore socialist, it's worrying that cryptobots have failed econ 101.
> why would you do groceries now when you could get more if you waited for next week ?
Because you're hungry and your fridge is empty?
Inflation creates artificial demand and drives consumerism, thereby arguably causing more resource usage/wastage than would otherwise be the case.
Depreciating money means that people's time horizon narrows and they're thinking more and more of the present at the expense of the future, causing all kinds of negative externalities.
Capitalism is actually supposed to make things cheaper, by virtue of competition spurring everyone on to be more efficient and economic with their inputs in order to provide cheaper and better products.
> Were those currencies to deflate, it would literally be more beneficial to not touch them.
This is such a silly, hyperbolic argument. People need to eat, they have other desires than just hoarding money, there will always be reasons to give out money and therefore there will always be reasons to provide goods and services for that money.
GP shows more understanding than you do. Inflation means savings in cash decrease in time, that's why you don't keep big savings in cash or standard bank account but you invest. Besides stocks, maybe gold, maybe cryptocurrencies.
Yes, they are astroturfing and socially manipulating false narratives as per usual with this site towards Bitcoin sentiment. There's no true discourse, as you'll notice anything said freely or positively about Bitcoin instantly is downvoted away. Oh yay, but let's pedantically talk for months on end about the beauty of ReactJS and Node bullshit. YAY.
And obviously the key take away from this statement I've made is that things get downvoted here for simply being in disagreement with folks who have the weight to downvote. They are not being downvoted due to in any way being against rules.
Attack on bitcoin != attack on crypto. Gridcoin suffers much less from this problem since the computations are actually useful and would likely be done anyway.
Because people finally realize the massive impact on the environment that Bitcoin has?
You can say "f** it, I don't care", but you can't deny just how much energy the Bitcoin network uses (or wastes, imho)
Bitcoin and other proof-of-work crypto comes with a price. And the price is environmental.
Not all usage of energy is equivalent. It requires energy to run carbon scrubbers, yet we would probably agree that carbon scrubbers are worth the energy costs for environmental benefits.
Can you prove that the energy bitcoin miners use would have been put to a more environmentally friendly use if they had not existed?
The energy used by bitcoin would simply have been not-used. Massive numbers of e-waste would've been avoided as well.
Of course, if it wasn't Bitcoin, another cryptocurrency would use as much energy as Sweden right now.
We have been interested in miners or mining farms which are fully powered by renewable energy. Canada and Sichuan is taking the lead and they have a lot of hydro power.
If you know any miners/mining farms powered by renewable energy sources, please send me a line to eren@countingcarbons.co
I’m noticing some very interesting attacks on blockchain technology lately. I’m willing to bet the calculations are derived from the probability theories we so dearly represent as near certainties.
It is year 2021 and people still think Bitcoin is boiling the oceans. Bitcoin is the greenest think on this planet. Economic empowerment it brings to individual together with energy extraction innovations is just beyond imagination of most people in this forum.
There are literally thousands of alternatives to Bitcoin, who bring the same "economic empowerment".
I can get instant, zero comission transfers with Nano, without banks. I assume there are many other cryptos like this one.
As skeptic I am about the survival of cryptos to regulators and big whales, I am actually using Nano to transfer money to people in LATAM, but as far as it becomes volatile or if it changed and had feeds, I'd just abandon it.
What's the point of bitcoin now, seriously. POW, very slow, very high transactions fees... ¿What does Bitcoin bring to the table? "Adoption" one would say, but no one is using Bitcoin to pay for anything, so the crypto enthusiasts changed the narrative to "store of value".
There are far better choices than bitcoin in and out of the crypto ecosystem for pretty much every use-case you can imagine. And the only reasons Bitcoin isn't in the ground it's because there's a lot of people invested with hope of selling for a profit.
Ah yes, the greenest "think" on the planet, consuming 130TWh of energy per year and rising.
Do you even think what you write? We don't need Bitcoin, global energy usage rises without Bitcoin as well.
But sure, go live in your little bubble where Bitcoin is the currency that solves all of society's problems, will forever rise in value and save the planet!
Oh, I forgot that bitcoin mining hardware just magically appears and never ends up on a landfill, power plants don't need to be built and maintained, and of course Bitcoin is probably 100% powered by renewables, right?
Definitely not 100% but getting there. Current estimates are 40-70%
Also, thanks to the nature of mining, you can setup operation close to source (not destroying land by energy transport) of energy.
Like these guys employ energy that would be otherwise wasted https://gam.ai/our-mission.html
436 comments
[ 2.6 ms ] story [ 301 ms ] thread- https://www.researchgate.net/publication/335993117_Cryptodam...
More generally the whole external cost of PoW is definitely a case of techno-utopianism meeting the real world and a lot of proponents wanting to put on blinkers even though this study shows that crypto-currency is currently a net social positive. Literally any indication that it has any negative outcomes elicits very strange responses.
Government should have shut it down long ago.
Dimes and quarters are perfectly fine. The $1 coin gets a certain amount of press by people touting it as a potential replacement to the bill, but it turns out the US $1 bill is remarkably cost-effective by paper currency standards, and should probably remain paper for the time being.
It's not for environmental reasons either: cash is just inconvenient when you think about it.
Try being an international. https://www.thelocal.se/20190624/the-locals-readers-how-swed...
> Bob, a United Kingdom resident but frequent visitor to Sweden, said this system is difficult for non-residents.
> “As a visitor I can't pay at places that only accept Swish because I don't have Swish. And without a Swedish bank account I can't get Swish. And without a Swedish residence, I can't get a bank account,” he explained.
> Howard Drobner, who is a frequent business traveller to Sweden, also proposed a tweak.
> “Some small vendors, like at flea markets and craft shows, only take Swish which I do not have and can not get due to the fact that I do not have a Swedish bank account or national number. I would therefore really like to have a Swish setup for frequent travellers to Sweden,” he said.
Those are people with money, doing ok but inconvenienced. There are things they can't buy.
Now imagine being homeless, or an "illegal" resident. People can't even help by giving you money any more. Friends have to buy food for you themselves instead of supporting you with cash. It gets harder and harder to obtain essentials. Human rights should transcend that, and the cashless systems falling into place in Sweden do not even attempt to be available for all persons.
No need to throw the baby away with the bathwater ...
This. A problem. "One" of the things has become "the thing" itself, as a whole ...
> It will be interesting to see what happens with the value of bitcoin as these limitations relative to the new kids on the block [...] become more obvious.
Will it? (become obvious) ... at least by the general public. That concerns me ...
> (sorry, pun intended, showing myself out the door etc.)
One handed clap :)
Every neighboring state is connected to the eastern power grid, which can transfer power from the Mexican border to Vermont.
Yes there is a lot of power being used to mine crypto, I mine but it is done on a system that I would normally have running 24/7 regardless of mining. Yes large mining specific "server" or "ASIC" farms use alot of energy but so does every other serverfarm. Maybe we should be talking about the energy cost of watching Pr0n, or TikTok videos both of whic IMHO provide far less benifit to society.
> "Bitcoin uses too much energy[1]"
> "It's only using surplus energy which would go to waste anyway[2][3]"
> "But it still has an environmental impact [4]"
I guess I'm just tired of seeing the same things repeated on every single thread about Bitcoin. When I saw a lazy comment like OPs, I overreacted, sorry.
[1] https://www.bbc.com/news/technology-56012952#:~:text=Cambrid.... [2] https://www.coindesk.com/the-last-word-on-bitcoins-energy-co... [3] https://www.wsj.com/articles/bitcoin-in-the-wilderness-11553... [4] https://www.cnbc.com/2021/02/05/bitcoin-btc-surge-renews-wor....
The use of bitcoin, a speculative good, as a sink for electricity creates less pressure for grids to manage electricity production (especially as the acceptable spot price trends towards the commercial price of electricity). It also ignores the innovative ideas that are geographically bound like storing potential energy by pumping water into dams.
The idea that bitcoin only uses surplus energy is disprovable just by looking at the regularity of block completion. If it were dependent on an irregular source like surplus electricity, you wouldn't see that.
There's a limit of how far you can transport electricity, the majority of methane gas burnt and wasted.
Mining gold could be used on other things, energy going into dropping bombs could be used for other things... sadly it's just idealism.
This argument really annoys me because, bitcoin has a purpose, I can buy things with bitcoin, just take a walk in Huaqiangbei and see how many shops accept bitcoin, talk to the people who's governments failed their national currency and they will agree the energy we spend on bitcoin helps them.
Until btc is replaced with a POS crypto currency like cardano[1] the energy we spend on btc is worth it for the people using it.
[1]https://ucarecdn.com/8673f817-d83b-441a-8281-45e8ae68bbec/-/...
There's way more energy available to us than biological humans will ever use.
The analysis can be generalized to say anything that uses 0.05 electricity creates these large harms. Perhaps true, but it’s not going to be unique to Bitcoin
This ignores the USE of the train station, and just focuses on energy costs to build it.
This study is only focused on mining new coins. Heads up, some of the (wildly inflated) value of bitcoin is tied to (arguable) uses and the ability of the blockchain to operate as a non-repudiation public ledger that allows global transfer of value with strong guarantees totally independent of any other central party.
Some quick math.
1 bitcoin is lets say worth $50,000. Let's assume $10K in electricity to mine this. So for every $1 in bitcoin, you need 20 cents of electricity.
Reduced to it's simplest, the claim here is that for every 20 cents of electricity, there is another 50 cents of health impacts.
Fair enough, but if you believe this, then a lot of other things have huge damages.
Pointing out other things also have an environmental impact just dilutes the discussion about Bitcoin and doesn't add anything to it.
If you applied this same damage model to something people had fondness for (ie, driving an electric car) you'd realize we should be working as HARD as we can to kill EV cars dead, because there is a MASSIVE unaccounted for cost to charging them (using this model).
Reality though is bitcoin chases low cost power, and that is currently often actually green (hydro, excess solar during day when their is curtailment and negative pricing etc). I can't imagine the economics making sense to mine using coal power.
(Imagine! Politics! ...)
(I’m extremely skeptical about PoW crypto of all types, BTC included; this is just about the reasonableness of this specific argument).
Bitcoin miners don't put their operations in the middle of nowhere and then ask someone to build hydro plants...
> So we built hydro plants [...] to run bitcoin miners?
> No, organizations built hydro plants for whatever reason in places where supply ended up higher than demand
So... by that logic, it seems that Bitcoin didn't increase the energy supply then.
> Bitcoin miners don't put their operations in the middle of nowhere and then ask someone to build hydro plants...
So now the demand follows the supply?
This has become almost a religious belief amongst cryptocurrency acolytes, but it's simply not true.
--
Edit: please see my comment¹ and piplikoc's comment² below for more detail on this.
1. https://news.ycombinator.com/item?id=26342411
2. https://news.ycombinator.com/item?id=26342366
Then any "published study" on this topic is automatically going to be flawed as well?
Otherwise nonsense claims can easily destroy the discussion by DoSing the opposition.
Their research indicates that a minority of mining is done using renewable resources:
> The survey findings estimate that on average 39% of proof-of-work mining is powered by renewable energy, primarily hydroelectric energy.
It also specifically addresses this popular claim of mining being powered mostly by renewables:
> China’s oversupply of hydroelectric energy during the rainy season has often been used as evidence in claims that a vast majority of mining is powered by environment-friendly power sources. While it is true that the Chinese government’s strategy to ensure energy self-sufficiency has led to the development of massive hydropower capacity, the same strategy has driven public investments in the construction of large-scale coal mines. Like hydroelectric power plants, these coal power plants often generate surpluses. It should not come as a surprise then that a significant share of hashers in the region equally report using both hydropower and coal energy to power their operations.
A cursory Google search says the percentage of renewable energy in the US and China is ~11% and ~23% respectively. The disparity between that and an average of 39% for crypto mining specifically does not seem to be factored in.
> The great unanswered question faced when exploring cryptodamages is that while we can identify select geographic hotspots of production we currently do not know in the aggregate where the electricity used in cryptocurrency mining is physically produced. This is because we, like Krause and Tolaymat, do not know the physical locations of cryptocurrency miners, whether individuals, groups or aggregates in, say, a region or country. There is considerable evidence of concentration of mining operations in particular locations, typically where reliable electricity is cheaply available, though, precise data are lacking. In the US, perhaps the most well-known concentration is the Mid-Columbia Basin area in central and eastern Washington State, where cheap electricity is produced by hydropower along the Columbia River, however, mining in other US locations also occurs. There is also evidence of large mining camps in China. With time and emergent research there may be improved information about the amounts of electricity devoted to mining cryptocurrencies for particular locations or regions, but it is currently not available.
It would be interesting to see the results of their analysis if recalculated using the more granular CCAF survey data.
Selection bias. I don't doubt that the miners who are investing god knows how much is necessary to _require a contractor_ will have scaled enough to need to concern themselves with cost of electricity, but the _majority_ of miners are not going to be those people, surely?
The small mining operations run by the common person has almost no impact in the scale of the network.
Everyone will look for cheapest power, but that on its own does not make it renewable.
Plus, regardless of your source, as long as you haven't built your own plant, the grid has to cover for the loss. If there isn't an abundance of renewable energy on the grid, then the operation wasn't neutral at all.
Miners were supposed to be everyday Joe’s.
Some of that may be hydro. A lot is coal.
Even when they do use green energy, the effect of doing that is to displace other users onto dirtier forms of energy, thus creating just as much pollution anyway.
Bitcoin is not green in any way whatsoever. Bitcoin specifically wastes energy, by design. This is never green. The first principle of green energy is to use less energy, as no energy is clean.
"Surplus energy" is another lie bitcoiners like to spread about this. Sure, there might be a few occasions where bitcoin mining might use surplus energy.
In the vast majority of cases, no, they are not doing that. That is just not a thing.
Also, it is wrong to assume that consuming 1GW near a hydroplant is fine. That 1GW would have been sold to someone else, and unless the net has an abundance of renewable energy, a non-renewable plant is going to have to cover for that.
The same market effects that apply to factories, research facilities, server farms, etc... also apply to cryptocurrency mining. We can't have our cake and eat it too -- if energy isn't fungible, then not every mining rig is going to be set up using the most efficient power source in the world. Not every miner is going to have the ability to just "choose" to use cheap renewable power, and if mining is still profitable where they are using the power sources available to them, then they're still going to do it.
True, it doesn't make sense to move the power all the way around the world, but that's also not really how things like the synchronous grid of Continental Europe works, where power is traded across 24 countries on a single grid.
If your have cheap renewable energy, when you start selling, excess non-renewable capacity and more expensive plants in general powers down in nearby areas and countries.
Any power taken from a renewable plant there when power price is positive means increased non-renewable output.
Both scenarios are very plausible, because if everyone within the market was perfectly efficient in choosing to use the cheapest power sources available, and if hydro was clearly the cheapest way to generate power, then it wouldn't just be being used for Bitcoin, it would be being used for every single portable, power-intensive task in general. We wouldn't be having a conversation about the environment in nearly any manufacturing field.
Given that this isn't happening, given that some things in the world still use coal power, and given that people are still worried about the environmnetal impacts of energy use in general, even though hydro exists -- the obvious conclusion is one of the following:
A) hydro isn't universally the cheapest power source.
B) there are other factors that determine where people will set up operations (taxes, living situation and preferred environment, costs beyond power generation, market saturation to the point that its still profitable to use expensive sources of power).
C) there are still environmental impacts of using a ton of power, even if it came from hydro, and hydro power doesn't just have zero environmental impact.
But obviously something is going on here, because bitcoin isn't special. If hydro power was the savior of power generation, then every single factory in the world would already be using it. But they're not, and it's reasonable to assume that the same market constraints and environmental situations also apply to bitcoin mining.
The fact that we are having an energy debate at all about any industry implies that something about the energy market, it's pricing, and its environmental impacts is more complicated than you're making it sound.
> The CCAF’s research finds that 76% of ‘hashers’ use renewable energy to power their activities, with hydropower the number one source at 62%. Wind and solar energy meanwhile are used by 17% and 15% respectively. This would appear to be consistent with previous research which estimates that 74% of bitcoins are mined using renewable energy. However, the CCAF’s report specifies that the 76% refers to the share of hashers who use renewable energy at any point. It estimates that only 39% of hashing’s total energy consumption comes from renewables. [1]
> Bitcoin, which is mostly mined with electricity from coal.[2]
> But most bitcoin mining facilities are located in China, which is still heavily reliant on coal-based power. Though the Chinese province of Sichuan is known to attract miners due to its cheap electricity and rich hydropower resources, the level of power generation capacity fluctuates depending on the season. [3]
[1] https://www.finextra.com/newsarticle/36672/renewable-energy-...
[2] https://www.bbc.com/news/technology-56012952#piano-inline3:~....
[3] https://www.cnbc.com/2021/02/05/bitcoin-btc-surge-renews-wor....
According to the BBC, a recent survey found that Bitcoin is powered by two-thirds fossil: https://www.bbc.com/news/science-environment-56215787
Inner Mongolia just announced it will shut down Bitcoin miners, apparently on climate grounds: https://news.bitcoin.com/chinas-inner-mongolia-plans-to-shut...
This is not actually true. And even if it were, it is irrelevant. If crypto uses green energy, it displaces other users to use more dirty energy.
The environmental cost of crypto is not that of the energy it uses, it is that of the dirtiest energy it displaces other users onto.
(Crypto also uses massive amounts of dirty energy directly. The idea that crypto uses green energy is basically a lie.)
"I bought a solar panel and AC converter to consume less from the grid. Oops, because of that now I am displacing my neighbours to use more dirty energy. How silly of me."
Seriously your argument makes no sense. How does one minor consumer of green energy displace you from doing the same?
Concrete and destruction of ecosystems and changes in water systems can all have negative impacts on the planet.
And that is the best case scenario
Basically no where is to the point we can just add power draws and say they have no health impact. Energy being fungible until an grid is to the point of having excess renewable power during the day and miners being spun up and down to absorb that excess any mining will have health impacts. I think the spin up and down is important too because it means over night miners aren't causing excess capacity to be built for storage.
https://cbeci.org/mining_map
https://en.wikipedia.org/wiki/Electricity_sector_in_China
Which is a bit absurd as you can pick anything in modern world, literally anything such as computers/phones in front of us reading this and point that XYZ damage was caused to the planet by the shiny macbook in front of us or android phone, not to mention the huge network of datacenters around the world from which the information is stored/streamed.
Until there is highly efficient zero loss superconductor long range networks of several orders of magnitude better energy storage then saying that energy "is wasted" on crypto is very misleading, that energy could be coming from a dam up in a mountain enjoying a sudden influx of rain or windmills/solar in middle of nowhere with no nearby large population centers to absorb this energy (lack of efficient long range transmission infrastructure and/or energy storage).
crypto is at least agnostic about what kind of energy you convert into it, and literally incentivizes renewables.
[1] https://sci-hub.st/10.1111/tran.12319
Of course it's just about profit... the point is that he should be aware of its environmental impact and the hypocrisy of his investment therein.
I'm only trying to explain to you how I understand the original post, and it has nothing to do with my own opinion on the subject (which may/or may not be the same).
Also consider more scalable cryptocurrencies running proof-of-stake.
Not that the cumulative damages amount to the total market cap (though this could be calculated as well)
Based on US Gov't estimate the average single family home uses 11 MWh per year. [1]
And a 2018 snapshot of BTC according to the paper: price per coin: $8000 MWh per coin: 80 Damages per coin: $3,170 Damagers per MWh: $39.62
Therefore, the typical single family home produces $435 in health and environmental damage each year.... not outside the realm of possibility.
[1] https://www.eia.gov/energyexplained/use-of-energy/electricit...
The willingness and ability of nations/humanity to allow such a state should probably factor more into investment decisions than it currently does.
Not precise enough. Power usage is proportional to block reward USD value, which is proportional to BTC value. But once in 4 years number of BTC awarded for mining a block is halved.
Fortunately as the block mining reward continues to be halved approximately every four years, the incentive to mine will decrease as well (though not quite as much, because miners also receive transaction fees).
1. https://www.pewresearch.org/global/interactives/remittance-f...
If that were true, Western Union would obviously have less utility than Visa. But actually, WU and Visa solve totally different problems with different risks associated, so it doesn't make sense to compare them in that way.
And how do we judge whether the market price is "worth" the use cases or not? Isn't that exactly what the market is doing in pricing the asset?
The intrinsic value of Bitcoin is nowhere near the current price. When the speculators all sell and the only demand comes from people looking to actually use them, the price will drop by a lot.
But, when that happens, the speculators/grifters will simply move to another coin. That other coin will see a similar bubble, and bitcoin’s value will drop even further as people perceive it as “dead” or worthless (as maybe it should have always been perceived)
So until this shit gets under control somehow, cryptocurrency is going to remain the exclusive domain of the speculator/gambler/criminal/grifter/gullible. And of course, the world will suffer increased energy usage, pollution, and GPU shortages.
If gamblers and thieves dominate the crypto market and cannot be outcompeted by honest actors then by definition the market has decided it prefers gamblers and thieves to honest actors. If someone wants an economy with rules other than "lol Caveat Emptor" they shouldn't get into crypto.
What I think you are not considering here is that you can speculate both on the upside or the downside. Speculators are only trying to predict the future price, speculation is not the same as a "pump and dump scheme".
> When the speculators all sell and the only demand comes from people looking to actually use them, the price will drop by a lot. ... bitcoin’s value will drop even further as people perceive it as “dead” or worthless (as maybe it should have always been perceived)
Like you said yourself, if it is true that Bitcoin is overvalued then it would be a good thing for every Bitcoin user if its price dropped to the fair value. Why are you describing that situation like a bad thing here? I expect users would be happy that they can now afford more of the coin for practical use cases, and adoption in those use cases would probably go up more than anything.
Or... every reason?
Gold is a speculative asset that also has some limited tangible uses too. So does that mean gold has less reasons to decrease in price than an asset which only has tangible uses and no speculation?
BTC is a one way bet, right up to the point where people decide it isn't worth holding any more. Just like certain vintages of wine.
The fact that there is some small rate of losses doesn't significantly impact the amount of downside speculation you'd expect.
Just accept that you're willing to shit on the planet to make a few bucks, it's fine.
Clearly the market doesn't think so. Nearly every asset class is getting inflated in the past year, in the middle of a pandemic no less.
Inflation encourages money changing hands. The market has absolutely fuck all to do with it.
Your bitcoin will have gone sideways three times, jumped up and down. Could be tripled. Could be halved. Still controlled by three chinese farms who could double spend at any point should it become less valuable.
Even as a hardcore socialist, it's worrying that cryptobots have failed econ 101.
Because you're hungry and your fridge is empty?
Inflation creates artificial demand and drives consumerism, thereby arguably causing more resource usage/wastage than would otherwise be the case.
Depreciating money means that people's time horizon narrows and they're thinking more and more of the present at the expense of the future, causing all kinds of negative externalities.
Capitalism is actually supposed to make things cheaper, by virtue of competition spurring everyone on to be more efficient and economic with their inputs in order to provide cheaper and better products.
> Were those currencies to deflate, it would literally be more beneficial to not touch them.
This is such a silly, hyperbolic argument. People need to eat, they have other desires than just hoarding money, there will always be reasons to give out money and therefore there will always be reasons to provide goods and services for that money.
Updated the original comment with a link to the freely available full text ...
- https://news.ycombinator.com/item?id=26342105
And obviously the key take away from this statement I've made is that things get downvoted here for simply being in disagreement with folks who have the weight to downvote. They are not being downvoted due to in any way being against rules.
(I am hoping they lead to intelligent debate, and - thus - improvement of existing systems ...)
Bitcoin and other proof-of-work crypto comes with a price. And the price is environmental.
Can you prove that the energy bitcoin miners use would have been put to a more environmentally friendly use if they had not existed?
If you know any miners/mining farms powered by renewable energy sources, please send me a line to eren@countingcarbons.co
thank you.
I can get instant, zero comission transfers with Nano, without banks. I assume there are many other cryptos like this one.
As skeptic I am about the survival of cryptos to regulators and big whales, I am actually using Nano to transfer money to people in LATAM, but as far as it becomes volatile or if it changed and had feeds, I'd just abandon it.
What's the point of bitcoin now, seriously. POW, very slow, very high transactions fees... ¿What does Bitcoin bring to the table? "Adoption" one would say, but no one is using Bitcoin to pay for anything, so the crypto enthusiasts changed the narrative to "store of value".
There are far better choices than bitcoin in and out of the crypto ecosystem for pretty much every use-case you can imagine. And the only reasons Bitcoin isn't in the ground it's because there's a lot of people invested with hope of selling for a profit.
But sure, go live in your little bubble where Bitcoin is the currency that solves all of society's problems, will forever rise in value and save the planet!