This is where you get accused of whataboutism for asking why we're not comparing and contrasting one morally dubious choice with the alternative choice that happens to be the default.
Well, that's literally the definition of "opportunity cost". So it's expected in any reasonable economic analysis.
I'm not defending proof-of-work cryptocurrencies at all. I'm bringing it up because the culture within the field of economics generally seems to have forgotten to compare alternatives, rather than doing analysis based on some idealized vacuum scenario. Once you're aware of this you will see it everywhere.
Does that make it a bad argument? Say we accept that Bitcoin causes damage to the environment, do we then ignore the energy expenses of the default because...I'm not sure where you are going with this.
While I don't know the incentives of the author's, I suspect a reason they target Bitcoin energy expenditure because it's easy.
The US Bureau of Engraving and Printing had greenhouse emissions of roughly 40,000 tons in 2021 to make roughly $900m worth of dollar bills. The US Mint I don't have up-to-date numbers for, but reasonable extrapolation is something like 20,000,000 tons for $5b worth of coinage.
In other words, Bitcoin uses more energy, and emits more carbon, than the largest currency in circulation. If you scale it by transaction volume, it's not even close.
Bitcoiners argue that you need to count the cost of the US military in that calculation, as the force which ultimately secures the value of the US dollar. You can't carve out "printing money" as the only impact.
And people who make that argument are idiots--it necessarily implies that if everyone were to magically switch to Bitcoin overnight, then every military in the world would be abolished at the same time as unnecessary. It makes no sense to allocate anything larger than exactly 0% of the military's emissions to the "cost" of currency, because that is how much effort the military spends on enforcing its value.
(You'd actually have a stronger argument trying to allocate a portion of the police budget to it, as it's the police forces who would enforce payment of debts in government specie, not military, and in the US at least, the military is prohibited from acting in a police capacity.)
Name calling people isn't a great way to "win" your discussion. And that isn't the implication at all, military exist for many other reasons one of which is to secure the wealth and economy of its citizens.
"Printing" bitcoin would take almost no energy at all, the ongoing electrical use is to ensure the network is working and secure.
Not really. It just increases the price on it. After all energy is not free as it is. The proof of work scheme will lead to an ever-increasing energy usage. It's just hardcoded into the system. Carbon tax will just price it so that it will accelerate a bit slower.
If you could implement a perfect global tax system, a high tax on energy used specifically for mining would be a good solution. Proof of work is designed to force miners to spend a given amount per bitcoin mined, and it doesn't matter whether that amount is spent on energy or taxes, so the tax would not actually cause any economic cost to miners.
Unfortunately, such a scheme would highly incentivize cheaters, or countries opting out of the tax collection.
In the short term, flexible power production like coal generation gets used to satisfy grid demand during situations with abnormally high power requirements. It has the benefit of being able to be turned on and off practically instantly. There is no economic incentive to build out sustainable generative capacity if it won't be running all the time, and balancing the load on renewable power is awkward (see power price rate inversions for examples of utilities paying people to use excess energy).
I remain unconvinced that cryptocurrency is long term detrimental to clean power generation infrastructure. Quite the contrary, the existence of cryptocurrency to mine acts as a 'productive' sink for power produced in excess of grid baselines. In practice, our entire grid could be renewables in excess of peak demand, and cryptocurrency mining a flexible network load. It could quite possibly get us off of non-clean energy entirely.
I can't speak for others but I'm definitely not blindly following group-think on this. There are countless uses for energy, and the idea that mining crypto is the best possible use for excess renewable power is a bold statement that requires a lot of explanation.
Written by "Eric McErlain, Director of External Affairs for GRIID Infrastructure". GRIID "procure[s] low-cost, carbon-free energy to build, manage, and operate a growing portfolio of vertically-integrated bitcoin mining facilities."
Hmm, I wonder why a PR representative for a Cryptomining company would advocate for Cryptomining…
> Don't shun others on subjects you are unfamiliar with. Speak gently and listen.
For someone pointing an awful lot of fingers and making a lot of extremely condescending accusations throughout this thread, I'm surprised you're offering this advice.
I work in the renewable power industry, and my father was a biologist who spent his career trying to mitigate the ecological disasters caused by my state's hydroelectric dams.
The link you've provided suggests that miners and hydroelectric providers could establish mutually beneficial economic partnerships. That hardly needs to be written; it's obvious. But I think if you polled the public on whether creating additional revenue streams for hydroelectric is a higher priority than reducing our overall energy demand -- well, do I even need to suggest what the results would be?
As a realist, I think you understand the fault in this logic. If we can incentivize the production of renewable energy via 'crypto credits' during down time it will alleviate the hesitation of upfront investment.
This idea is the genesis of currency in Mesopotamia. Offsetting seasonal harvests via "tokens" that allow farmers to subsist all year. Storage alone won't solve everything.
If there is really that much excess capacity, there is plenty of overhead to do something useful with it that actually offsets fossil sources. Like splitting water to create Hydrogen or CO2 capture. It's not a very efficient process, but it doesn't matter if you have that much energy to spare.
If it's really once in a while when it's exceptionally sunny that they do it, there's no point in doing this at all because the cost (and high depreciation) of the mining rigs makes no sense if you don't run them very often.
Either way it's a bad solution to invest energy into some made-up assets, considering how bad the climate crisis already is.
I'm not against crypto per se, but proof of work really needs to die. It's a relic from a bygone worry-free era that will never come back. It will only lead to ever more energy usage. And we will not be out of the woods for a century even if we do do everything possible.
Of course this requires cryptocurrencies to have some form of actual utility, which so far isn’t in evidence. Absent this utility, excess renewable energy could simply be stored for later use, ie in chemical batteries or as hydrogen.
The shady nature of what often goes on in crypto has a lot more to do with human nature than the technology of trustless distributed ledgers.
It's still a wild west out there, and we weren't exactly model citizens during the literal wild west either. It wasn't tamed by people altruistically agreeing to stop robbing each other with their powerful gun technology, but by laws and law enforcement; crypto needs the same, and then we can hopefully eventually enjoy the benefits of the technology, freeing us from the iron grip of ancient scumlords like Visa, MasterCard, PayPal etc.
There's no fundamental law that says a technology must be abused, that's human choice.
(BTW another choice is Bitcoin choosing to stay with extremely wasteful proof of work consensus mechanism, when proof of stake by all indications seems to work too. Again that's not something fundamentally flawed with crypto in general, that's people making greedy decisions because they're balls deep invested in Bitcoin in particular. Right now it's the top dog, but we should hope it won't always be like that if they continue to grossly misuse energy by choice with viable alternatives.)
I find it extremely disappointing how even the HN crowd struggle to distinguish ubiquitous human greed from the problem crypto solves and its potential uses. Just because crypto hasn't broken down your door and forced you to get some benefit from it doesn't mean it's intrinsically useless; if we all ate with chopsticks and knives were mainly known for use in stabbings, it doesn't logically follow that knives are fundamentally a weapon. Give it time and law enforcement, maybe that knife can be good for something else one day.
Maybe my hope regarding HN being one of the last places for civilised and nuanced discussion is misplaced, and it sure seems to be changing in recent years.
You still don’t give an obvious use case for cryptocurrencies (beyond the math being interesting). You are right that most technologies are not inherently evil but the same holds for „traditional“ banking including credit. There are plenty of customer-owned banks and there is no reason a transparent, fair and secure alternative to visa couldn’t exist if someone bothered to build it instead of some power hungry crypto scam.
What's the incentive to create it without something like Bitcoin mining, which can be deployed practically anywhere with an energy source and internet connection, to balance out the costs of doing so? Even if there are better uses, if we can't transport the energy now then it's pointless to build new stranded energy sources. Bitcoin provides the incentive to start that development now. Maybe in the future, batteries will offer a better use of the energy, and won't we be glad to have the existing energy source as soon as that happens?
You misunderstand the problems with energy production, we already produce excess. The plant produces a fix amount of KwH, wether it's used or not. So some of it isn't used, and is considered excess.
It can be used to do anything, but for some reason you want it to do crypto.
Non-interdictability and resistance to everything short of thermo-rectal cryptanalysis is actual utility, even if non-USG-approved actors transacting isn't useful to you.
Arguably this is currently more of a bug instead of a feature given it’s used primarily for crime and scams. Government regulation over money flows has legitimate purposes and is not pure repression.
> .. given it’s used primarily for crime and scams.
Often claimed and yet not true.
> Hamas thought it could flout Western surveillance and international sanctions by embracing the world’s leading digital asset. It thought wrong, and the story is illuminating for those who mistakenly believe that bitcoin provides a safe space for criminals, money launderers and the financiers of terror.
> ... excess renewable energy could simply be stored for later use, ie in chemical batteries or as hydrogen.
"Simply" implies "in an economically viable fashion" here. Which means that someone has to be willing to pay for (A) building these batteries or electrolyzers and (B) operating them.
Building such systems to an industrially relevant scale hasn't really happened yet. Because it hasn't been economically viable.
Just now they're building a 30 MW electrolyzer near Leuna and it'll be the largest in Europe. Compare that to a regular powerplant which has 1 GW and you'll get an idea that large scale hydrogen synthesis isn't all that near.
Either (A) governments subsidize such systems to a great degree or (B) electricity has to be dirt cheap for a decent fraction of the year (say 50 % or 4400 hours), because if you want to run an electrolyzer, ideally you want to run it 24/7, not every second day at noon because there's cheap PV electricity.
I think (A) is more likely to happen within the next decade than (B), but even when we eventually have these electrolyzers, Bitcoin mining might still be more lucrative.
Your point of view here seems to neglect energy storage. There is no use for excess renewables that is more productive than storing it for later, when intermittent renewables go offline. Stored renewable energy is the only thing that can replace fossil energy at those times.
This is why billions of dollars are going into storage and transport for renewable energy (batteries, hydrogen, and some outliers like methane and ammonia). Creating any new energy demand, be it flexible or constant, only increases the total amount of renewables we need.
> our entire grid could be renewables in excess of peak demand
Are you hypothesizing about a world where we have more renewables than we can consume at all times? Sure, I guess mine away in that world. In this world, though, it's doing measurable damage.
> "Why do we need currency when we can just store commodities?"
Did I imply that we don't need or shouldn't have currency? And are you implying that crypto and stored renewable energy should be equivalent priorities?
> You are deeply out of touch with reality if you believe they aren't curtailing capability
"At all times" was the key qualifier to my statement. I'm well aware that excess capacity from intermittent sources is a huge problem and curtailment is the workaround employed these days, which is precisely why I'm saying that storage should be a higher priority than crypto.
Energy storage doesn’t just have to be chemical reservoirs like that. Since most residential loads are thermal (heating and cooling of air and water), there’s quite a potential to make improvements there. Other loads are often “deferrable” or advancable.
When electricity is cheap, run the fridge/freezer extra hard, make ice or ultra-heat the water tank. Or “pre-charge” the building extra hot or cool but within level of comfort.
When it’s expensive, maybe slow down the dryer/dish|clothes washing or defer it for some hours. Same for any charging. At the end of the day, I don’t care if my stuff is washed+dry in 50 or 500 minutes most of the time.
> In the short term, flexible power production like coal generation
Coal power is the least flexible way to generate power.
> It has the benefit of being able to be turned on and off practically instantly.
No, the opposite.
> There is no economic incentive to build out sustainable generative capacity if it won't be running all the time,
Of course there is.
And anyway, the article is about using an old coal power plant to mine bitcoin. 1000 tonnes of carbon dioxide a day, without the bitcoin the plant would have been shut down.
Why do you say coal is the least flexible way to produce energy? As compared to what, hydro, nuclear, solar,…?
The article mentions all the incentives US states have been using to attract Bitcoin mining (after China banned it), so maybe this was a ‘clever’ trick from the fossil fuel industry to keep itself alive. And what is the most flexible load to quickly make use of such incentives? Bitcoin mining it turns out, but it could have been something else. Start pricing the [lb][g]CO2Eq/kWh and then see what will happen.
I thought coal was pretty slow to get ramp up and ramp down. Nat gas (and hydroelectricity) generators are what can be flipped up/down (or on/off) at the flick of a switch pretty much.
Coal generation is typically used for base loads, while gas generation is typically used for peakers. Intuitively, you can think of it like starting or stopping a charcoal vs gas grill. The coals are much more difficult to light, and they stay hot for a long time.
> Quite the contrary, the existence of cryptocurrency to mine acts as a 'productive' sink for power produced in excess of grid baselines
By that logic, any use of electricity is a sink for power, which is ridiculous logic. If you spend millions of dollars in mining equipment, you're not just going to let it sit idle for the 22 hours a day when there isn't any excess electricity. You're going to mine whenever it's profitable. Bitcoin users also need miners to clear transactions and provide security against 51% attacks.
> By that logic, any use of electricity is a sink for power, which is ridiculous logic.
It isn't though. If you're using electricity for heat in the winter and generation is low for a few contiguous days, you can't just turn off everybody's heat. They'd freeze. But you could certainly stop mining Bitcoin for a week out of the year if the cost of electricity that week was high enough to make it unprofitable.
The problem with renewables isn't that they only generate power a small fraction of the time. It's that they generate power most of the time, but most of the time doesn't work for things that need power all of the time. So having things that can consume power most of the time, and thereby fund that amount of generating equipment, allows that consumption to be turned off so that extra generating equipment can service the things that need power all of the time when there is low generation supply.
You can't fully solve this problem with cryptocurrency, but it's because there isn't enough cryptocurrency -- cryptocurrency mining would have to be on the order of half of the power grid on a typical day, which is not going to happen. But it's a thing that can help rather than hurt to the extent that it exists.
The real problem is that we don't price carbon, so then people mine Bitcoin by burning coal. But they also run lights and computers and elevators by burning coal, which is just as bad and has the same solution.
I realise I'm getting into the 3-level-deep silly semantics of a comparison I don't really care about here (and certainly have no interest in defending that which you poetically label 'cryptoshit'), but if we're going to play Bastardly Inventions comparisons, hairdryers have apparently killed quite a few people over the decades - the cause of many a tragic house fire. Google "hairdryer fire" and you'll be scrolling a looong time.
And how many million$ of cryptoswindle funds would the family of each victim pay, in theory, if they could have their loved one back? How would that overall balance sheet conclude?
The problem is not bitcoin's energy usage per se, the problem is that proof-of-work is a feedback loop where the more one person mines, the more everyone else needs to mine to keep up. In other words, the mere existence of proof-of-work puts a floor on the price of energy; in the presence of proof-of-work it is impossible for us as a society to ever have energy that is "too cheap to meter", because when the price of energy falls below the production price of bitcoin it economically incentivizes more miners. It's self-fulfilling conspicuous consumption for the electronic age.
In contrast, one person blow-drying their hair does not create a feedback loop of more people blow-drying their hair.
> the mere existence of proof-of-work puts a floor on the price of energy
I thought this was backwards, or maybe there's a balance between the two? I assumed that the price of energy acts as a soft floor for the price of bitcoin. Mining pauses when it's unprofitable, or the cost difference is eaten in speculation. The hash rate graphs appear to align with this.
Yes, hash rates are sensitive to the price of energy. But the price of bitcoin is not inherently sensitive to the hash rate. The network adjusts the difficulty to ensure a constant production rate of bitcoin, so supply is not dependent on the hash rate, and miners do not buy bitcoin, so there is no reason for demand to be dependent on it.
So for any given bitcoin price, rational miners will hash until their cost to mine a bitcoin exceeds its price. If energy is cheap, miners will use more of it, if it's expensive, they will use less.
All energy use is bad for everyone. The question is how much utility is gained from that use, and does that utility outweigh the downsides of consuming the energy.
Criticizing uses of energy based on their cost and utility isn't persecution or oppression of cryptocurrency people.
It's not clear to me that hairdryers are worth it for society.
You hit the nail on the head. In today’s society the playbook is to find something, get some kind of science to write some lengthy research to justify the point, whether correct or not, it doesn’t matter. Then it’s either think of the children, the environment, race or sex. Once you have the critical mass of online bullies you can make it a political statement and leverage it for votes. Remember, don’t actually solve the perceived problem, that would waste all that efforts because you wouldn’t have the votes.
Rinse and repeat.
How do the costs of our current dominant model of currency change at scale? Seems to me the cost-per-unit drops as the currency foothold expands, based primarily on existing infrastructure.
Conversely, costs to "mine" bitcoin and similar proof-of-work currencies increase over time, unless I'm mistaken. The infrastructure is already in place, so it seems absolutely bonkers for costs to go up at scale.
Is the argument for bitcoin that in the long run (hundreds of years), with bitcoin the global currency and no longer being mined since it hit the cap, costs will on average be less than bills/coins/credit/cheques?
The mining must continue. Mined blocks allow transactions to occur. Without mining there is no transactions either.
In theory, instead of getting paid through newly minted bitcoin, the miners get paid through transaction fees instead. The cost of mining doesn't always rise though, it adjusts based on the number of miners competing for the prize. If you work harder than everyone else, you get paid more. So usually this cost rises. But if it stops being profitable and lots of people stop mining, the cost of mining will decrease.
> The mining must continue. Mined blocks allow transactions to occur. Without mining there is no transactions either.
Yes. BUT, the energy used for the actual transaction processing is negligible compared to the energy wasted on the random number hashing that is mining.
I could probably process all the world's bitcoin transactions on a raspberry pi in realtime if this hadn't been artificially coupled to doing a ton of mathematical busywork.
Of course there is a reason for this busywork, meaning not everyone can do it. But this busywork really should be replaced with something less harmful to the environment like the proof of stake ETH has implemented now.
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[ 3.0 ms ] story [ 143 ms ] threadI'm sure all the greedy speculators are getting ready for another bullrun.
I'm not defending proof-of-work cryptocurrencies at all. I'm bringing it up because the culture within the field of economics generally seems to have forgotten to compare alternatives, rather than doing analysis based on some idealized vacuum scenario. Once you're aware of this you will see it everywhere.
While I don't know the incentives of the author's, I suspect a reason they target Bitcoin energy expenditure because it's easy.
In other words, Bitcoin uses more energy, and emits more carbon, than the largest currency in circulation. If you scale it by transaction volume, it's not even close.
(You'd actually have a stronger argument trying to allocate a portion of the police budget to it, as it's the police forces who would enforce payment of debts in government specie, not military, and in the US at least, the military is prohibited from acting in a police capacity.)
Name calling people isn't a great way to "win" your discussion. And that isn't the implication at all, military exist for many other reasons one of which is to secure the wealth and economy of its citizens.
"Printing" bitcoin would take almost no energy at all, the ongoing electrical use is to ensure the network is working and secure.
Unfortunately, such a scheme would highly incentivize cheaters, or countries opting out of the tax collection.
I remain unconvinced that cryptocurrency is long term detrimental to clean power generation infrastructure. Quite the contrary, the existence of cryptocurrency to mine acts as a 'productive' sink for power produced in excess of grid baselines. In practice, our entire grid could be renewables in excess of peak demand, and cryptocurrency mining a flexible network load. It could quite possibly get us off of non-clean energy entirely.
It's really a shame so many blindly follow group-think on this nuanced subject.
Perhaps to the National Hydropower Association knows a bit more than you: https://www.hydro.org/powerhouse/article/why-hydropower-owne...
Hmm, I wonder why a PR representative for a Cryptomining company would advocate for Cryptomining…
For someone pointing an awful lot of fingers and making a lot of extremely condescending accusations throughout this thread, I'm surprised you're offering this advice.
I work in the renewable power industry, and my father was a biologist who spent his career trying to mitigate the ecological disasters caused by my state's hydroelectric dams.
The link you've provided suggests that miners and hydroelectric providers could establish mutually beneficial economic partnerships. That hardly needs to be written; it's obvious. But I think if you polled the public on whether creating additional revenue streams for hydroelectric is a higher priority than reducing our overall energy demand -- well, do I even need to suggest what the results would be?
This idea is the genesis of currency in Mesopotamia. Offsetting seasonal harvests via "tokens" that allow farmers to subsist all year. Storage alone won't solve everything.
If it's really once in a while when it's exceptionally sunny that they do it, there's no point in doing this at all because the cost (and high depreciation) of the mining rigs makes no sense if you don't run them very often.
Either way it's a bad solution to invest energy into some made-up assets, considering how bad the climate crisis already is.
I'm not against crypto per se, but proof of work really needs to die. It's a relic from a bygone worry-free era that will never come back. It will only lead to ever more energy usage. And we will not be out of the woods for a century even if we do do everything possible.
Here is a great primer: https://www.hydro.org/powerhouse/article/why-hydropower-owne...
It's comments only from someone who owns a bitcoin mine, presented as if he's a hydro power expert.
It's still a wild west out there, and we weren't exactly model citizens during the literal wild west either. It wasn't tamed by people altruistically agreeing to stop robbing each other with their powerful gun technology, but by laws and law enforcement; crypto needs the same, and then we can hopefully eventually enjoy the benefits of the technology, freeing us from the iron grip of ancient scumlords like Visa, MasterCard, PayPal etc.
There's no fundamental law that says a technology must be abused, that's human choice.
(BTW another choice is Bitcoin choosing to stay with extremely wasteful proof of work consensus mechanism, when proof of stake by all indications seems to work too. Again that's not something fundamentally flawed with crypto in general, that's people making greedy decisions because they're balls deep invested in Bitcoin in particular. Right now it's the top dog, but we should hope it won't always be like that if they continue to grossly misuse energy by choice with viable alternatives.)
I find it extremely disappointing how even the HN crowd struggle to distinguish ubiquitous human greed from the problem crypto solves and its potential uses. Just because crypto hasn't broken down your door and forced you to get some benefit from it doesn't mean it's intrinsically useless; if we all ate with chopsticks and knives were mainly known for use in stabbings, it doesn't logically follow that knives are fundamentally a weapon. Give it time and law enforcement, maybe that knife can be good for something else one day.
Maybe my hope regarding HN being one of the last places for civilised and nuanced discussion is misplaced, and it sure seems to be changing in recent years.
It can be used to do anything, but for some reason you want it to do crypto.
Often claimed and yet not true.
> Hamas thought it could flout Western surveillance and international sanctions by embracing the world’s leading digital asset. It thought wrong, and the story is illuminating for those who mistakenly believe that bitcoin provides a safe space for criminals, money launderers and the financiers of terror.
from here: https://thehill.com/opinion/finance/4273988-hamas-just-learn...
"Simply" implies "in an economically viable fashion" here. Which means that someone has to be willing to pay for (A) building these batteries or electrolyzers and (B) operating them.
Building such systems to an industrially relevant scale hasn't really happened yet. Because it hasn't been economically viable.
Just now they're building a 30 MW electrolyzer near Leuna and it'll be the largest in Europe. Compare that to a regular powerplant which has 1 GW and you'll get an idea that large scale hydrogen synthesis isn't all that near.
Either (A) governments subsidize such systems to a great degree or (B) electricity has to be dirt cheap for a decent fraction of the year (say 50 % or 4400 hours), because if you want to run an electrolyzer, ideally you want to run it 24/7, not every second day at noon because there's cheap PV electricity.
I think (A) is more likely to happen within the next decade than (B), but even when we eventually have these electrolyzers, Bitcoin mining might still be more lucrative.
This is why billions of dollars are going into storage and transport for renewable energy (batteries, hydrogen, and some outliers like methane and ammonia). Creating any new energy demand, be it flexible or constant, only increases the total amount of renewables we need.
> our entire grid could be renewables in excess of peak demand
Are you hypothesizing about a world where we have more renewables than we can consume at all times? Sure, I guess mine away in that world. In this world, though, it's doing measurable damage.
You are deeply out of touch with reality if you believe they aren't curtailing capability during slow demand.
Did I imply that we don't need or shouldn't have currency? And are you implying that crypto and stored renewable energy should be equivalent priorities?
> You are deeply out of touch with reality if you believe they aren't curtailing capability
"At all times" was the key qualifier to my statement. I'm well aware that excess capacity from intermittent sources is a huge problem and curtailment is the workaround employed these days, which is precisely why I'm saying that storage should be a higher priority than crypto.
When electricity is cheap, run the fridge/freezer extra hard, make ice or ultra-heat the water tank. Or “pre-charge” the building extra hot or cool but within level of comfort.
When it’s expensive, maybe slow down the dryer/dish|clothes washing or defer it for some hours. Same for any charging. At the end of the day, I don’t care if my stuff is washed+dry in 50 or 500 minutes most of the time.
Coal power is the least flexible way to generate power.
> It has the benefit of being able to be turned on and off practically instantly.
No, the opposite.
> There is no economic incentive to build out sustainable generative capacity if it won't be running all the time,
Of course there is.
And anyway, the article is about using an old coal power plant to mine bitcoin. 1000 tonnes of carbon dioxide a day, without the bitcoin the plant would have been shut down.
The article mentions all the incentives US states have been using to attract Bitcoin mining (after China banned it), so maybe this was a ‘clever’ trick from the fossil fuel industry to keep itself alive. And what is the most flexible load to quickly make use of such incentives? Bitcoin mining it turns out, but it could have been something else. Start pricing the [lb][g]CO2Eq/kWh and then see what will happen.
> Quite the contrary, the existence of cryptocurrency to mine acts as a 'productive' sink for power produced in excess of grid baselines
By that logic, any use of electricity is a sink for power, which is ridiculous logic. If you spend millions of dollars in mining equipment, you're not just going to let it sit idle for the 22 hours a day when there isn't any excess electricity. You're going to mine whenever it's profitable. Bitcoin users also need miners to clear transactions and provide security against 51% attacks.
It isn't though. If you're using electricity for heat in the winter and generation is low for a few contiguous days, you can't just turn off everybody's heat. They'd freeze. But you could certainly stop mining Bitcoin for a week out of the year if the cost of electricity that week was high enough to make it unprofitable.
The problem with renewables isn't that they only generate power a small fraction of the time. It's that they generate power most of the time, but most of the time doesn't work for things that need power all of the time. So having things that can consume power most of the time, and thereby fund that amount of generating equipment, allows that consumption to be turned off so that extra generating equipment can service the things that need power all of the time when there is low generation supply.
You can't fully solve this problem with cryptocurrency, but it's because there isn't enough cryptocurrency -- cryptocurrency mining would have to be on the order of half of the power grid on a typical day, which is not going to happen. But it's a thing that can help rather than hurt to the extent that it exists.
The real problem is that we don't price carbon, so then people mine Bitcoin by burning coal. But they also run lights and computers and elevators by burning coal, which is just as bad and has the same solution.
Not even the promised 'trust'.
Therefore the only thing it does is playing local energy market against a global finance system / speculation.
The only use case is if you heat directly with energy without any other option like a heat pump.
We need to stop Bitcoin.
It's a system Virus
But if the power in the area is coming from coal then every use of that power is equally coal based.
Hair dryers use more power than bitcoin mining, ban them first.
The attempt to demonize certain uses of power is just the attempt to demonize certain people in order to oppress them.
For one, I've yet to see a hairdryer be a critical component of a large-scale swindle.
And how many million$ of cryptoswindle funds would the family of each victim pay, in theory, if they could have their loved one back? How would that overall balance sheet conclude?
In contrast, one person blow-drying their hair does not create a feedback loop of more people blow-drying their hair.
I thought this was backwards, or maybe there's a balance between the two? I assumed that the price of energy acts as a soft floor for the price of bitcoin. Mining pauses when it's unprofitable, or the cost difference is eaten in speculation. The hash rate graphs appear to align with this.
So for any given bitcoin price, rational miners will hash until their cost to mine a bitcoin exceeds its price. If energy is cheap, miners will use more of it, if it's expensive, they will use less.
Bitcoin miners run at high energy costs 24/7 to make the operator more money.
Criticizing uses of energy based on their cost and utility isn't persecution or oppression of cryptocurrency people.
It's not clear to me that hairdryers are worth it for society.
They do make long hair look fabulous, which in my opinion is much better value than crypto.
Conversely, costs to "mine" bitcoin and similar proof-of-work currencies increase over time, unless I'm mistaken. The infrastructure is already in place, so it seems absolutely bonkers for costs to go up at scale.
Is the argument for bitcoin that in the long run (hundreds of years), with bitcoin the global currency and no longer being mined since it hit the cap, costs will on average be less than bills/coins/credit/cheques?
In theory, instead of getting paid through newly minted bitcoin, the miners get paid through transaction fees instead. The cost of mining doesn't always rise though, it adjusts based on the number of miners competing for the prize. If you work harder than everyone else, you get paid more. So usually this cost rises. But if it stops being profitable and lots of people stop mining, the cost of mining will decrease.
Yes. BUT, the energy used for the actual transaction processing is negligible compared to the energy wasted on the random number hashing that is mining.
I could probably process all the world's bitcoin transactions on a raspberry pi in realtime if this hadn't been artificially coupled to doing a ton of mathematical busywork.
Of course there is a reason for this busywork, meaning not everyone can do it. But this busywork really should be replaced with something less harmful to the environment like the proof of stake ETH has implemented now.
https://news.ycombinator.com/item?id=253999