Bitcoin's $137k Jackpot

Post by aianus » Fri, Apr 29, 2016, 9:24 PM UTC

thescriptkiddie wrote: post #29

xigency wrote: post #21

Sort of unrelated but, "According to my calculation, a single Bitcoin transaction uses roughly enough electricity to power 1.57 American households for a day." http://motherboard.vice.com/read/bitcoin-is-unsustainable I find this interesting thinking about Bitcoin as a currency. The first cryptographic currency example that I had read, from a cryptography book, didn't involve active power. I'm really surprised that B…

Each bitcoin block takes 25 BTC (11000 USD at time of writing) worth of electricity to mine, because that is the maximum that the sum total of miners can afford to spend and still break even. Currently it's only possible to fit somewhere around 2000 transactions in each block, because there is a hard-coded limit on the size of a block (1 MiB). So each transaction costs 11000/2000=5.5 USD, which is indeed the approxim…

Post by xigency » Fri, Apr 29, 2016, 9:25 PM UTC

shemnon42 wrote: post #28

xigency wrote: post #21

Sort of unrelated but, "According to my calculation, a single Bitcoin transaction uses roughly enough electricity to power 1.57 American households for a day." http://motherboard.vice.com/read/bitcoin-is-unsustainable I find this interesting thinking about Bitcoin as a currency. The first cryptographic currency example that I had read, from a cryptography book, didn't involve active power. I'm really surprised that B…

Those older examples suffered from the "double spend problem" where you could spend the digital currency twice (or more). Kind of like cheque fraud. The Proof of Work part of bitcoin (the part that consumes all that electricity) creates a consensus record so that if double spends are performed, only one of them will stick. Now double spends are a "feature" called "replace by fee." Preventing double spends is worth mi…

Post by xigency » Fri, Apr 29, 2016, 9:31 PM UTC

aianus wrote: post #31

thescriptkiddie wrote: post #29

Earlier quoted context omitted.

Each bitcoin block takes 25 BTC (11000 USD at time of writing) worth of electricity to mine, because that is the maximum that the sum total of miners can afford to spend and still break even. Currently it's only possible to fit somewhere around 2000 transactions in each block, because there is a hard-coded limit on the size of a block (1 MiB). So each transaction costs 11000/2000=5.5 USD, which is indeed the approxim…

> So each transaction costs 11000/2000=5.5 USD No, each transaction costs at most $5.50 USD. You haven't established any lower bound in your calculations. A better approach would be to calculate the average number of hashes required to mine a block and the power efficiency of the latest generation ASIC miners. Also, for what it's worth, $5 is much cheaper than a Western Union or SWIFT wire transfer so even this upper…

Post by Houshalter » Fri, Apr 29, 2016, 9:36 PM UTC

Cyph0n wrote: post #9

hughes wrote: post #2

This reminds me of a similar error from 2005[1] where a trader mistook the "price" and "quantity" fields of the trading software. Instead of selling 1 share for 610,000 yen, 610,000 shares were sold for 1 yen. The mistake cost around $225 million. [1] http://www.foxnews.com/story/2005/12/09/typing-error-causes-...

Damn that's huge. You'd assume that the software checks the dollar amount and asks for a confirmation, or better yet permission from a higher up, if it exceeds some value.

Post by maxerickson » Fri, Apr 29, 2016, 9:38 PM UTC

ChuckMcM wrote: post #24

"exogeneous enforcement mechanisms." -- Chortle, I really need one of those :-). I had not been aware of how the miners could launder bitcoin, that seems like a pretty big hole you can drive a lot of bitcoin through.