It's worth mentioning that this kind of comparison is strange. Bitcoin mining does not get more difficult or change in any way with the number of transactions you mine. Mining always occurs on a single 80-byte header, and the entire transaction portion of that is a Merkle hash tree.
The point here is that if Bitcoin would actually finally increase the block size of their chain (like Bitcoin Cash and others have done) then a.) there wouldn't be a constant backlog of transactions and b.) the "energy-per-tx" graph like this would look better.
That's almost like asking "what is the correct number of sushi restaurants for a city?" The answer is a function of the marketplace.
In the case of cryptocurrencies, the answer is likely a combination of what miners and users can support. The goal is to be large enough that we don't have throughput problems and block space doesn't become a bidding war.
It's also worth mentioning that this doesn't mean the end-users have to be able to run nodes themselves or on mobile phones, since that makes use of a process called Simple Payment Verification (SPV) where they only process block headers and get the blocks they are interested in, but still verify the consensus of the network.
But, it also depends on what you see cryptocurrencies as. If you want them to replace traditional cash and create a "digital cash" world, then you want to see them accepted and used anywhere at a very large scale. In that world-view you have millions of transactions regularly and miners get paid with the sum of lots of small fees.
However, if you think that cryptocurrencies should only be used as a speculative asset or as a "digital gold" then you don't care much about it actually being transacted, and in that case fees as high as $50/tx are fine because you don't have any expectation that the world will be using it at scale.
But wouldn't we always want block space to be at least a little bit of a bidding war? After all anything I add to the blockchain is stored permanently and massively georeplicated.
Miners don't have to store the full chain, end users don't need to store the full chain, but somebody has to store it. Seems like those people, the people running full nodes, should have the final say on how big the blocks are and therefore what the throughput of the network is. I guess in reality, they do, since they decide which fork to run. Right?
> But wouldn't we always want block space to be at least a little bit of a bidding war
Once we get to the point where everyone can do 10 TXs per day without a bidding war, then maybe. But also consider that we can currently store every single bit of communication in the 1980's on a chip about the size of my finger. History seems to tell us that what we think is a large amount of data becomes commonplace in a few decades.
Probably another way to look at it is that people regularly open their mobile phone or browser and view a few minutes of video and transfer 300MB - 1GB of data to do so. During that same time the transactions of the entire world economy could have been transferred.
Well they also decide what to put in the blocks they mine. Nobody forces anyone to put something in a block. And, yes, they also can decide which fork to run.
Block space is always a little bit of a bidding war, even with zero fees. That's because each additional byte added to a block increases the time it takes to propagate the block by just a little bit.
When miners find a block, they race to get it published as quickly as possible to as many nodes as possible. If A finds a block, and stuffs it full of transactions; and shortly thereafter B finds a block, and includes no transactions, B might actually "win" the race because B can propagate his tiny block much faster than A. So each txn added incurs a tiny penalty just by virtue of adding to the payload.
> they decide which fork to run
In reality most hashpower is pooled and pools autoswitch between forks depending on which is more popular in the moment. So most people running miners are mining all forks.
How about all the people work for Visa etc and their commutes and all the other things that come with it. If you think about it Bitcoin is completely autonomous
If we're counting the footprint of Visa's 19,500 employees [1], we'd have to start counting the footprint of every Bitcoin miner and ASIC manufacturer. Which is (a) silly and (b) unlikely to affect a difference of orders of magnitude.
Based off of current GPU availability (which isnt mining bitcoin per se but is) does cover coins which are comparable) I would say no, Bitcoin probably has more physical locations and more people involved
But visa doesn't provide most of the functions of bitcoin infrastructure. Visa does need to hold the balance of my account. Visa does need or make available all of my equity worth of assets for me to transfer. Visa does not custody my assets. This is literally apple to oranges (or visa to bitcoin)
I don't agree that PoW's massive energy consumption is excused by your argument, but it is true that for every employee an enterprise has to employ to provide its goods/services, there's massive associated energy consumption.
I remember reading that the extra food that a cyclist consumes, and the energy required to grow and transport it, far exceeds the energy that is used by a bus per passenger.
Humans are high maintenance machines, and cryptocurrency, in automating previously manual processes done by humans, could potentially result in major energy savings. But not in Bitcoin's iteration, where it's consuming as much energy as whole countries, to process only 300,000 transactions a day.
There's no way to measure either directly, but I bet Lightning network has been used an order of magnitude more times to handwave Bitcoin's scaling issues in internet discussions, than it has been used to actually transfer money.
I went through a bitcoin phase in mid 2017 and that's what we used it for back then. Lightning network adoption is just around the corner! It'll solve high fees and do billions of transactions per day!
The link doesn't state whether it's counting only the energy costs incurred by VISA, or if it includes the energy costs of making a transaction on the SWIFT payment network that VISA, Mastercard, banks, and other institutions run on top of. Obviously to do a fair comparison you have to take SWIFT into account, otherwise you're not capturing the true energy cost of making a VISA payment.
VISA (or Mastercard) do not 'run on top of' SWIFT. The net position of each VISA/MC institution will be transferred with SWIFT, but this is one payment with potentially millions of underlying card transactions.
If they factored in the other-bank transaction costs, there'd be something else to "what-about." What about the company's energy costs in its non-payment processing? How about all the plastic they use to make those credit cards? The silicon in the card swipe machine?
None of these things will bridge that gap, unveiling a missing data point that somehow makes VISA less efficient by six magnitudes that somehow researchers were missing all this time. But constantly asking for more detail is a good way to stay in denial about Bitcoin's terrible numbers.
Perhaps you missed the fine print on the chart where it was comparing one BTC transaction to 100,000 visa transactions?
If the chart were anywhere close to 1:1 I could understand wanting to nitpick little details, but in this case go ahead and double/triple/quadruple the estimate, and it's still shocking.
Yeah, but does this compare the cost of creation of the currency? Isn't that what's (fallaciously) being compared here?
How much does it cost to create a US dollar, to be able to have transactions with it? Did it take 100 years of faith in the US credit to establish that? How much energy was that?
In truth, if I factor in the establishment of the United States and several hundred years of money policy, it'll be higher. But for a fair comparison with Bitcoin, that'd be unfair, right? Because the US's money policy is obviously historically tied to Britain's, so I should include that too. And Britain was adapting the system that was established in feudal times. A lot of work went into making fiat currency real.
So a fair comparison would be Bitcoin versus the cost to print money, plus the history of the US currency system, UK, and all of monetary history before that. This is starting to look pretty bad!
> How much does it cost to run the US treasury though?
Would the U.S. Treasury disappear if we switched to Bitcoin? (Hint: look at countries that don't have their own currency. They still collect taxes and spend and borrow money.)
I went looking for an example and to save anyone else some time: Ecuador no longer uses the sucre and instead has used the US dollar since 2000. They do still have a ministry of economy and finance which has a central bank. Fascinating ty!!
https://en.wikipedia.org/wiki/Ministry_of_Economy_and_Financ...
I'm not super hip to how BTC works, but doesn't a coin get created in the process of verifying a transaction? Like mining bitcoins involves finding constants that will produce so many zeros when appended to the record of the transaction and hashed, and you earn a bitcoin when you find such a constant
What kind of last ditch attempt of an argument is this to make crypto look better. By that logic we're going to need to incorporate the energy required to dig the ore out of the ground to make crypto rigs and the entire history of computing into the equation.
All that's relevant is what it costs now or else we're going back to the beginning of the universe
I mean, I know people are commenting on whether the comparison is valid, but regardless, the BTC energy cost at at 741 kWh for a single transaction is pretty close to the average monthly household energy usage in the US of 867 kWh [1]. That seems pretty nuts on its face to me.
What is that in money, 50 bucks? (Live in Germany, we have very high energy prices, so I relly don't know. Single in 50sqm Appartment, paying 47euros per month for a 100% renewable plan.)
Depends where in the US -- In Texas (as long as there aren't any blizzard-driven blackouts with accompanying rate spikes), retail electricity costs something like $0.10/kWh. In California, it's closer to $0.20/kWh.
If you've looked at the transaction fees lately, you can definitely pay to power an American house for 1 month too (that is, assuming unreasonably that the house was powered at the same cost that most bitcoin miners pay for power: ~$0.04/kWh)
To put it in perspective, ~$1,000,000,000,000 USD is being secured by a decentralized system by using that much electricity. How much electricity/oil/other power is used by the US military to ensure the US government stays in power and the US currency retains its value? Surely orders of magnitude more energy than what is used for Bitcoin.
The number of transactions that are completed on the base layer is not the relevant metric. As the technology matures and as Bitcoin is more fully monetized, transactions will happen on higher layers. The "high" energy cost is necessary to secure the decentralized system.
To be fair the average "new" house is the US is almost twice as big as the average new house in the Germany.
Also there is a link between weather and energy usage. An average household in Louisiana or California uses way more electricity than New York's average.
Germany ranks very high in terms of renewable energy ratio and I think that's more remarkable.
Intuitively, it seems to me that the 741 kWh number for a single transaction cannot be a marginal number (i.e., the cost of the transaction itself without factoring in overhead). That's just way too high - it would be around $100 in electricity per transaction.
The difference is important because as Bitcoin adoption increases the number of transactions will increase and the cost-per-transaction will fall dramatically. But the actual marginal cost likely won't. (I bet the result would still dramatically favor Visa.)
No, that number sounds like a marginal number to me. Someone else commented that miners pay an average of like 4 cents per kWh, which works out to about $30 of electricity costs to miners per transaction. Recent per-transaction miner fees are currently in the $10-20 range, but don't forget the winning miner gets a reward that's currently ~$330,475 per block.
> The difference is important because as Bitcoin adoption increases the number of transactions will increase
No, the maximum number of transactions per block is fixed (actually, the maximum size of a block is fixed, but there's a limit to how small each transaction can be).
> and the cost-per-transaction will fall dramatically.
No, because of the limit on the number of transactions, the cost per transaction will increase (users have to pay a higher per-transaction fee to increase the chance of it being included in a block, and miners are incentivized to use the extra income from transaction fees to buy more power).
> No, the maximum number of transactions per block is fixed (actually, the maximum size of a block is fixed, but there's a limit to how small each transaction can be).
This has nothing to do with whether the number of transactions will increase.
>No, because of the limit on the number of transactions, the cost per transaction will increase (users have to pay a higher per-transaction fee to increase the chance of it being included in a block, and miners are incentivized to use the extra income from transaction fees to buy more power).
My point was that they seem to be counting overhead beyond the marginal transaction cost, and if they are, then the number they report will fall as the transactions increase. You seem to be talking about how the marginal cost per transaction will increase.
For a full picture, however, you would need to count the total number of VISA transactions and compare that to the total number of Bitcoin transactions. I would guess the absolute energy foot print of VISA is still considerably larger.
But I am not trying to defend the energy usage of PoW, here. A single Bitcoin block can only fit about 3500 transactions and all miners of the world compete for being the first in solving the emerging Block‘s cryptographic puzzle. This is where the insane energy consumption comes from.
Other cryptos work differently in that respect and, hence, are way cheaper.
This is a dumb comparison. Bitcoin's energy consumption is necessary to secure a decentralized digital store of value. There is no alternative. It is electricity well spent.
Accordingly, you're using the wrong framework. Bitcoin's energy consumption prevents double spending, which is necessary for securing such a system. It isn't energy used to compute a transaction.
What all of these analyses fail to realize is that the network is just used for clearing most of trading and payments are actually done off network.
Think of the difference between energy used to buy gold (just buy GLD) vs energy used to move physical gold. (Fuel + Security etc)
What is the economic (hence energy cost) impact of maintaining the financial infrastructure where VISA is only a tiny part of?
While the traditional financial infrastructure is under doing rapid modernization, my layman eye still see lots of manual intervention for compliance, enforcement, etc...
I can setup a dozen nodes on AWS and build a crypto with a million times the transaction capacity of Bitcoin. Obviously the downside to this is centralization; someone can be banned or censoredfor any reason.
Blockchains are first decentralized, permissionless, censorship resistant solutions.
BTC mining is highly centralized. Fiat on/off ramps (essential if one wishes to spend her BTC) are regulated by local governments and relatively easy to censor.
If there really were global demand for a censorship resistant currency don’t you think there would be more merchants accepting BTC by now?
If anyone is looking for energy/txn as the main metric for measurement, there are many other fully decentralized blockchains can also perform 500,000x more efficiently than bitcoin.
Because humans are deciding on whether to use BTC or another option for handling payments. This means that we must decide whether "decentralization, permissionlessness, and censorship resistance" are worth the astronomical other costs.
As your purchasing power gets eroded away ("stolen" by central banks), we each decide for ourselves how much we want to participate in the propping up a broken system.
... it's relevant because to the end user, moving money from place to place is moving money place to place.
Bitcoin is the defacto main cryptocurrency and Visa is one of the main payment processors.
A cryptocurrency not attached to anything else is useless. I'm sure you could easily beat Visa too by having a little app that "processes transactions" on some modern 5nm scale mobile device. But it wouldn't be real world useful.
So another story about Bitcoin‘s energy consumption. Sigh. What we should really be interested in is its actual carbon foot print. You can’t just translate energy usage into CO2 emissions. These are a function of geolocation and energy efficiency of the underlying hardware. It’s actually pretty tricky to calculate that.
TL;DR: While there is this "energy consumption of Argentina" number in circulation implying Bitcoin's carbon emissions equates that of a whole developed country, in reality this number is closer to that of Kansas City.
You’re welcome. The article also gives some interesting insights into the mining business.
I actually I would love to see some Bitcoin miners to comment about this whole topic more often on HN. I know at least some of them should be lurking here but for some reason decide to keep completely silent.
Hash power translates to proof of work, which is like a miner buying a lotto ticket to win the next block. The more tickets a miner has, the more likely they are to win the next block.
The energy usage of Bitcoin or similar projects like Ethereum are derived from the “mining” aspect which is not connected to transactions or transaction volume.
For example, early Bitcoin was generally, for purposes of discussion, about the same transaction throughput as we have today. But there were very few miners, so the energy costs were very low. Was Bitcoin truly many orders of magnitude more efficient back then? No.
It’s simply that there are many many more miners competing for rewards, because Bitcoin is valuable. There’s an energy lottery built into the Bitcoin protocol that emits new currency.
This lottery is directly related to the security of the network but not the number of transactions or usage. Unfortunately it’s hard to find an exact parallel but something like the military protection of the dollar would be a more valid comparison than Visa’s transaction volume.
Consider this: even if the blocks were empty, which means no transactions, the energy usage would be the same.
"Those critics of Bitcoin who point to its energy usage (as of this writing, ~75 terawatt hours per year) seem unwilling to acknowledge the energy usage that keeps the US dollar afloat. The US economy used almost 29,000 terawatt hours in 2019. As confirmed by the US Treasury Department, the value of the dollar is backed by all the goods and services in the US economy which would also include its energy sector. Furthermore, in 2019 world energy consumption was something on the order of 120,000 terawatt hours. Bitcoin uses ~0.25% of US energy consumption and less than 0.05% of world energy consumption."
> seem unwilling to acknowledge the energy usage that keeps the US dollar afloat
Except you're comparing all the "real things" that make up the US economy to Bitcoin where the energy usage is just for Bitcoin (discovering coins and doing transactions). The statement you quoted seems entirely disingenuous.
You flipping subject on it's head. The US economy does not produce stuff in order for dollar to exist. The dollar (at least in theory) exists to reflect the US economy and simplify exchange of goods.
Do you think the entire us economy would disappear if bitcoin became the dominant currency of global trade? People will still want to trade the same goods and services.
Its the other way around. Money is just a made up thing to reduce friction in the economy. Think of an economy where people would still need to "buy" stuff with other stuff. That would waste a lot more energy and straight out would make our economy impossible.
Does this actually include all the energy needed to maintain the VISA infrastructure too? Like the servers, energy used by VISA employees, offices, etc?
> Ok - but then you need to include all the exchanges and wallet developers etc.
Yes indeed we should consider all factors.
For Bitcoins we should count the number of active full-time people employed as miners and developers.
I feel like the amount of people required to maintain a system should be counted in green efforts.
Like for example bio supermarkets they provide you with products without packaging. Example you get your cereals from a giant glass container to your reusable container. Now that requires extra effort on handling/trasportation/refrigeration/storage.
If all those things require a lot of more time we should consider the time of X people vs the saving in Y plastic or the saving in Z plastic.
It might turn out that Bitcoin employees less/equal/more people time for transaction.
People's time is very expensive.
- One study [1] estimated that 70B kWh were required to run the Internet, at an estimated cost of ~$7B annually assuming 10c/kWh (which is probably high);
- One report [2] estimated the energy consumed by Bitcoin at 121.36TWh, which is 121.36B kWh.
So assuming these numbers are remotely accurate, which is a big "if" I'll admit, more energy is spent on Bitcoin than the entire rest of the Internet infrastructure.
Other commenters have asked variation of "once [coin] moves from PoW to PoS, what will [no coiners] complain about?" That's easy: not the (essentially pointless) energy expenditure (and resultant carbon footprint) obviously.
Banks are not good at storing value over time, that's why institutions and high net worth individuals are searching for alternatives.
Banks store government money which depreciates gradually in good years, and devalues rapidly in bad years. It's all one direction, toward zero, it never gains value.
On top of the relentless depreciation, add the risk of bank insolvency.
Are you referring to the low interest rate? I suspect that depends largely on which bank/currency you're referring to. Bitcoin sure doesn't fair very well, except if you invest at the right time. The bank is a known quantity.
109 comments
[ 5.6 ms ] story [ 188 ms ] threadThe point here is that if Bitcoin would actually finally increase the block size of their chain (like Bitcoin Cash and others have done) then a.) there wouldn't be a constant backlog of transactions and b.) the "energy-per-tx" graph like this would look better.
In the case of cryptocurrencies, the answer is likely a combination of what miners and users can support. The goal is to be large enough that we don't have throughput problems and block space doesn't become a bidding war.
It's also worth mentioning that this doesn't mean the end-users have to be able to run nodes themselves or on mobile phones, since that makes use of a process called Simple Payment Verification (SPV) where they only process block headers and get the blocks they are interested in, but still verify the consensus of the network.
But, it also depends on what you see cryptocurrencies as. If you want them to replace traditional cash and create a "digital cash" world, then you want to see them accepted and used anywhere at a very large scale. In that world-view you have millions of transactions regularly and miners get paid with the sum of lots of small fees.
However, if you think that cryptocurrencies should only be used as a speculative asset or as a "digital gold" then you don't care much about it actually being transacted, and in that case fees as high as $50/tx are fine because you don't have any expectation that the world will be using it at scale.
Miners don't have to store the full chain, end users don't need to store the full chain, but somebody has to store it. Seems like those people, the people running full nodes, should have the final say on how big the blocks are and therefore what the throughput of the network is. I guess in reality, they do, since they decide which fork to run. Right?
Once we get to the point where everyone can do 10 TXs per day without a bidding war, then maybe. But also consider that we can currently store every single bit of communication in the 1980's on a chip about the size of my finger. History seems to tell us that what we think is a large amount of data becomes commonplace in a few decades.
Probably another way to look at it is that people regularly open their mobile phone or browser and view a few minutes of video and transfer 300MB - 1GB of data to do so. During that same time the transactions of the entire world economy could have been transferred.
Well they also decide what to put in the blocks they mine. Nobody forces anyone to put something in a block. And, yes, they also can decide which fork to run.
When miners find a block, they race to get it published as quickly as possible to as many nodes as possible. If A finds a block, and stuffs it full of transactions; and shortly thereafter B finds a block, and includes no transactions, B might actually "win" the race because B can propagate his tiny block much faster than A. So each txn added incurs a tiny penalty just by virtue of adding to the payload.
> they decide which fork to run
In reality most hashpower is pooled and pools autoswitch between forks depending on which is more popular in the moment. So most people running miners are mining all forks.
If we're counting the footprint of Visa's 19,500 employees [1], we'd have to start counting the footprint of every Bitcoin miner and ASIC manufacturer. Which is (a) silly and (b) unlikely to affect a difference of orders of magnitude.
[1] https://en.wikipedia.org/wiki/Visa_Inc.
Do they have 1000s of office all around the world with 100s of thousands working in offices and branches like banking industry?
Banking does a lot more than payments. Most people working at banks do not work on payments.
I remember reading that the extra food that a cyclist consumes, and the energy required to grow and transport it, far exceeds the energy that is used by a bus per passenger.
Humans are high maintenance machines, and cryptocurrency, in automating previously manual processes done by humans, could potentially result in major energy savings. But not in Bitcoin's iteration, where it's consuming as much energy as whole countries, to process only 300,000 transactions a day.
I went through a bitcoin phase in mid 2017 and that's what we used it for back then. Lightning network adoption is just around the corner! It'll solve high fees and do billions of transactions per day!
https://www.investopedia.com/articles/personal-finance/05051...
The difference is orders of magnitude. SWIFT won't cross the gap. Bitcoin has a lot of things going for it. Energy efficiency isn't one of them.
Nitpick: nothing gets transferred with SWIFT. SWIFT is a messaging service. Settlement happens on separate rails.
None of these things will bridge that gap, unveiling a missing data point that somehow makes VISA less efficient by six magnitudes that somehow researchers were missing all this time. But constantly asking for more detail is a good way to stay in denial about Bitcoin's terrible numbers.
If the chart were anywhere close to 1:1 I could understand wanting to nitpick little details, but in this case go ahead and double/triple/quadruple the estimate, and it's still shocking.
How much does it cost to create a US dollar, to be able to have transactions with it? Did it take 100 years of faith in the US credit to establish that? How much energy was that?
In truth, if I factor in the establishment of the United States and several hundred years of money policy, it'll be higher. But for a fair comparison with Bitcoin, that'd be unfair, right? Because the US's money policy is obviously historically tied to Britain's, so I should include that too. And Britain was adapting the system that was established in feudal times. A lot of work went into making fiat currency real.
So a fair comparison would be Bitcoin versus the cost to print money, plus the history of the US currency system, UK, and all of monetary history before that. This is starting to look pretty bad!
Would the U.S. Treasury disappear if we switched to Bitcoin? (Hint: look at countries that don't have their own currency. They still collect taxes and spend and borrow money.)
All that's relevant is what it costs now or else we're going back to the beginning of the universe
[1] https://electricityplans.com/kwh-kilowatt-hour-can-power/
So roughly somewhere between $70-$150.
The number of transactions that are completed on the base layer is not the relevant metric. As the technology matures and as Bitcoin is more fully monetized, transactions will happen on higher layers. The "high" energy cost is necessary to secure the decentralized system.
Also there is a link between weather and energy usage. An average household in Louisiana or California uses way more electricity than New York's average.
Germany ranks very high in terms of renewable energy ratio and I think that's more remarkable.
The difference is important because as Bitcoin adoption increases the number of transactions will increase and the cost-per-transaction will fall dramatically. But the actual marginal cost likely won't. (I bet the result would still dramatically favor Visa.)
No, the maximum number of transactions per block is fixed (actually, the maximum size of a block is fixed, but there's a limit to how small each transaction can be).
> and the cost-per-transaction will fall dramatically.
No, because of the limit on the number of transactions, the cost per transaction will increase (users have to pay a higher per-transaction fee to increase the chance of it being included in a block, and miners are incentivized to use the extra income from transaction fees to buy more power).
This has nothing to do with whether the number of transactions will increase.
>No, because of the limit on the number of transactions, the cost per transaction will increase (users have to pay a higher per-transaction fee to increase the chance of it being included in a block, and miners are incentivized to use the extra income from transaction fees to buy more power).
My point was that they seem to be counting overhead beyond the marginal transaction cost, and if they are, then the number they report will fall as the transactions increase. You seem to be talking about how the marginal cost per transaction will increase.
But I am not trying to defend the energy usage of PoW, here. A single Bitcoin block can only fit about 3500 transactions and all miners of the world compete for being the first in solving the emerging Block‘s cryptographic puzzle. This is where the insane energy consumption comes from.
Other cryptos work differently in that respect and, hence, are way cheaper.
Accordingly, you're using the wrong framework. Bitcoin's energy consumption prevents double spending, which is necessary for securing such a system. It isn't energy used to compute a transaction.
Fine, add 0.00000000000001% for the energy a wire transfer takes to net out hundreds of millions of credit card transactions.
While the traditional financial infrastructure is under doing rapid modernization, my layman eye still see lots of manual intervention for compliance, enforcement, etc...
I can setup a dozen nodes on AWS and build a crypto with a million times the transaction capacity of Bitcoin. Obviously the downside to this is centralization; someone can be banned or censoredfor any reason.
Blockchains are first decentralized, permissionless, censorship resistant solutions.
If there really were global demand for a censorship resistant currency don’t you think there would be more merchants accepting BTC by now?
1/ There are four stages that all market-based monetary goods pass through in their evolution to becoming a fully fledged money:
1. Collectible 2. Store of Value 3. Medium of exchange 4. Unit of account
Rai stones were used by islanders as a ledger and store of value. https://en.wikipedia.org/wiki/Rai_stones
Because humans are deciding on whether to use BTC or another option for handling payments. This means that we must decide whether "decentralization, permissionlessness, and censorship resistance" are worth the astronomical other costs.
M1 Money supply graph.
As your purchasing power gets eroded away ("stolen" by central banks), we each decide for ourselves how much we want to participate in the propping up a broken system.
Bitcoin is the defacto main cryptocurrency and Visa is one of the main payment processors.
A cryptocurrency not attached to anything else is useless. I'm sure you could easily beat Visa too by having a little app that "processes transactions" on some modern 5nm scale mobile device. But it wouldn't be real world useful.
Yes, moving money to protect it from hyperinflation. Protecting it from being seized or appropriated by corrupt regimes.
Bitcoin moves money very well in those contexts, can Visa do those things?
See https://xrpl.org/carbon-calculator.html instead and ignore visa/mastercard
PoW is still the worst even worse than than paper money.
They seem to equate kwh to some co2 emissions value and just multiplies them to create a comparative value.
The conversation is just multiplied yes.
If anybody's interested, here is a careful analysis of Bitcoin's carbon foot print (2019): https://www.sciencedirect.com/science/article/pii/S254243511...
TL;DR: While there is this "energy consumption of Argentina" number in circulation implying Bitcoin's carbon emissions equates that of a whole developed country, in reality this number is closer to that of Kansas City.
I actually I would love to see some Bitcoin miners to comment about this whole topic more often on HN. I know at least some of them should be lurking here but for some reason decide to keep completely silent.
Miners load hash rate to get a better chance at the next block, the transactions just go along for the ride.
This would be true regardless of how much hash power is cumulative.
That's what hash power does.
For example, early Bitcoin was generally, for purposes of discussion, about the same transaction throughput as we have today. But there were very few miners, so the energy costs were very low. Was Bitcoin truly many orders of magnitude more efficient back then? No.
It’s simply that there are many many more miners competing for rewards, because Bitcoin is valuable. There’s an energy lottery built into the Bitcoin protocol that emits new currency.
This lottery is directly related to the security of the network but not the number of transactions or usage. Unfortunately it’s hard to find an exact parallel but something like the military protection of the dollar would be a more valid comparison than Visa’s transaction volume.
Consider this: even if the blocks were empty, which means no transactions, the energy usage would be the same.
https://jamie-dyer.medium.com/why-i-hate-bitcoin-38fad90b37e...
Bitcoin has a lot going for it. But these arguments are so incredibly stupid.
Would the energy sector go away if the U.S. switched to Bitcoin? The American economy? No? Then it isn't a cost inherent to the U.S. dollar.
Bitcoin is just a distributed ponzi scheme.
Except you're comparing all the "real things" that make up the US economy to Bitcoin where the energy usage is just for Bitcoin (discovering coins and doing transactions). The statement you quoted seems entirely disingenuous.
Is the energy consumption of VISA transactions calculated based on their servers energy consumption?
So now what about the energy consumption of the whole VISA company?
Visa has 19,500 employees https://en.wikipedia.org/wiki/Visa_Inc.
Does Bitcoin employees 19500 people full-time to work? Time is interchangeable with money and money with electricity/CO2 emissions.
Ok - but then you need to include all the exchanges and wallet developers etc.
https://en.wikipedia.org/wiki/Visa_Inc.
Does Bitcoin employees 19500 people full-time to work? Time is interchangeable with money and money with electricity/CO2 emissions
Maybe, when you include all the miners and the other parts of the ecosystem needed to make Bitcoin available for use.
Yes indeed we should consider all factors. For Bitcoins we should count the number of active full-time people employed as miners and developers.
I feel like the amount of people required to maintain a system should be counted in green efforts. Like for example bio supermarkets they provide you with products without packaging. Example you get your cereals from a giant glass container to your reusable container. Now that requires extra effort on handling/trasportation/refrigeration/storage. If all those things require a lot of more time we should consider the time of X people vs the saving in Y plastic or the saving in Z plastic.
It might turn out that Bitcoin employees less/equal/more people time for transaction. People's time is very expensive.
- One study [1] estimated that 70B kWh were required to run the Internet, at an estimated cost of ~$7B annually assuming 10c/kWh (which is probably high);
- One report [2] estimated the energy consumed by Bitcoin at 121.36TWh, which is 121.36B kWh.
So assuming these numbers are remotely accurate, which is a big "if" I'll admit, more energy is spent on Bitcoin than the entire rest of the Internet infrastructure.
Other commenters have asked variation of "once [coin] moves from PoW to PoS, what will [no coiners] complain about?" That's easy: not the (essentially pointless) energy expenditure (and resultant carbon footprint) obviously.
[1]: https://www.forbes.com/sites/christopherhelman/2016/06/28/ho...
[2]: https://www.bbc.com/news/technology-56012952
https://xrpl.org/carbon-calculator.html (scroll to the bottom)
Compares BTC/ETH/XRP/VISA/MASTERCARD and Paper Money
I wound not interpret too much into the actual values they are unlikely to be very accurate.
Visa is good at processing many small transactions.
Bitcoin is good at storing value over time, across borders, without censorship.
Since Bitcoin is useful without many transactions, it's deceptive to measure its energy usage per transaction.
It would be equally useless to cite Visa's 10-year stored value percentage gain vs. gold, because preserving value over time is not what Visa does.
From my limited vantage point, BitCoin's actual use cases are underground/gray markets and speculation.
Banks store government money which depreciates gradually in good years, and devalues rapidly in bad years. It's all one direction, toward zero, it never gains value.
On top of the relentless depreciation, add the risk of bank insolvency.
Banks are terrible stores of value.
Historically, you could have bought 99.8% of the days Bitcoin existed and you would be up today.