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One Bitcoin miner is buying 20,000 16nm wafers from TSMC per month

dvhardware.net

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Re: One Bitcoin miner is buying 20,000 16nm wafers from TSMC per month

#171

Post by Blindedwino »

seanwilson wrote: post #159
blackrock wrote: post #129

The amount of waste of Bitcoin Mining is incredible. It is all about virtual digital mining, which is to race to find the first hash, that has X number of zeros in the front of it. And this burns an incredible amount of electricity. And all for what? Just to show proof of work. Can't there be a more useful usage of cryptocurrency mining to show proof of work? Something that is more relevant to humanity. Like protein…

> Something that is more relevant to humanity. Like protein folding? Or planet hunting? Or pattern analysis? Or something else, that can be used to build an AI brain? It's not that easy. You need to be able to generate tasks that have a predictable levels of difficulty.

You don't "need" to, though. We're talking about internet pogs here.

Re: One Bitcoin miner is buying 20,000 16nm wafers from TSMC per month

#172

Post by yorwba »

lalaland1125 wrote: post #149
blackrock wrote: post #129

The amount of waste of Bitcoin Mining is incredible. It is all about virtual digital mining, which is to race to find the first hash, that has X number of zeros in the front of it. And this burns an incredible amount of electricity. And all for what? Just to show proof of work. Can't there be a more useful usage of cryptocurrency mining to show proof of work? Something that is more relevant to humanity. Like protein…

It is impossible to create a "useful" PoW. The issue comes down to incentives. As bitcoin is a decentralized, trust-less system, there needs to be constant and powerful incentives to prevent miners from cheating (by creating forks, or executing any number of other attacks). The current main incentive against cheating is that miners will lose their invested PoW (compute time + electricity) if they cheat and get their…

> The current main incentive against cheating is that miners will lose their invested PoW (compute time + electricity) if they cheat and get their block thrown out. However, with a useful PoW, this calculus changes. Now, the PoW is no longer "wasted" when the miner cheats and gets caught as the PoW is now useful for something besides mining.

So you spend $x on (compute time + electricity) to mine a useful PoW worth $y outside the blockchain and an additional mining reward of $z. If you cheat, you don't get to collect the $z reward. Although your original $x are not completely wasted, you still only have $y instead of the $y + $z you could have had.

How is that not incentive enough?

Re: One Bitcoin miner is buying 20,000 16nm wafers from TSMC per month

#173

Post by usrusr »

twohlix_ wrote: post #57
guiomie wrote: post #42

Earlier quoted context omitted.

I was wondering about this, why do they sell them instead of mining them? They could sell the older model once the new chips they designed are ready no?

Because they can get more money faster by selling the mining units. Mining is not a guaranteed return but selling a unit is. Plus large scale mining requires a large capital risk (electricity), that is compounded with the large capital investment into the hardware. Plus if they have significant BTC reserves (I believe they do) then selling mining equipment strengthens the BTC network and improves the value, maybe, of…

This is even more interesting than I thought at first glance: by selling hardware to other miners (for conventional money, I suppose, as that's what they need to pay upstream suppliers like TSMC) they can fund large mining power bills without having to sell their cryptotokens to do so, which would depress the market, which would threaten their whole business. BTC will crash whenever the influx of money into the network is lower than the outflux to power suppliers. Miners can't "hodl" everything when they have power bills to pay. Selling chips to mining investors is a form of inviting new money into the network.

Re: One Bitcoin miner is buying 20,000 16nm wafers from TSMC per month

#174

Post by erentz »

blackrock wrote: post #129

The amount of waste of Bitcoin Mining is incredible. It is all about virtual digital mining, which is to race to find the first hash, that has X number of zeros in the front of it. And this burns an incredible amount of electricity. And all for what? Just to show proof of work. Can't there be a more useful usage of cryptocurrency mining to show proof of work? Something that is more relevant to humanity. Like protein…

People keep saying this. But are have you also thought about how wasteful is Facebook or Instagram or Youtube are? Do you know how much electricity Facebook burns running computers to serve fake images and shitty news? Or Youtube serving Logan Paul videos?

If we really care about the environment we wouldn't be playing this game of trying to say one kind of environment destroying energy consumption is okay but another isn't. We would instead argue to directly solve the root problem, which is dirty energy polluting our environment, by making sure energy pricing covers that cost. That way the market can tell us if Logan Paul videos are more valuable to people than say Bitcoin, and we would actually do something to fix the environment rather than simply making it cheaper for one energy consumer (Youtube) to pollute at the expense of outlawing another (Bitcoin).

Re: One Bitcoin miner is buying 20,000 16nm wafers from TSMC per month

#175

Post by usrusr »

jen729w wrote: post #105
nimos wrote: post #54

Earlier quoted context omitted.

The % of the network they would control would be too high maybe? Fundamentally the value of their product is based on the price of bitcoin. A single miner that gets close to 50% might be seen a a huge risk and drive down the price.

Let’s say some party/group gets 51%. Now they “own” the blockchain. Doesn’t its value drop to 0, thereby making the whole effort pointless? I’m not going to buy BTC (or whatever) from that system, therefore the owners take no cash from it. Yeah they have all the BTC, but so what? Everyone loses. What am I missing?

> What am I missing?

Shorts? Conventional wisdom states that a 51% attack would destroy the very same value it would misappropriate, but when you can bet real money on BTC crumbling you get an entirely different playing field. Still very unlikely as everybody with that kind of hashrate is already rewarded far too handsomely, but if someone ever offers shorts on one of the smaller altcoins, I'd almost expect someone to state an at least cost-neutral attack just for kicks.

Re: One Bitcoin miner is buying 20,000 16nm wafers from TSMC per month

#176

Post by GhostVII »

elmar wrote: post #133
blackrock wrote: post #129

The amount of waste of Bitcoin Mining is incredible. It is all about virtual digital mining, which is to race to find the first hash, that has X number of zeros in the front of it. And this burns an incredible amount of electricity. And all for what? Just to show proof of work. Can't there be a more useful usage of cryptocurrency mining to show proof of work? Something that is more relevant to humanity. Like protein…

A little known fact is that validating a block with 1 Bitcoin transaction or all the world 10 minute transactions in Bitcoin would spend roughly the same energy. The energy is spent on security independent of transaction volume.

But as transaction volume increases, the reward for mining increases, so miners will spend more money on electricity.

Re: One Bitcoin miner is buying 20,000 16nm wafers from TSMC per month

#177

Post by Nec28 »

blackrock wrote: post #129

The amount of waste of Bitcoin Mining is incredible. It is all about virtual digital mining, which is to race to find the first hash, that has X number of zeros in the front of it. And this burns an incredible amount of electricity. And all for what? Just to show proof of work. Can't there be a more useful usage of cryptocurrency mining to show proof of work? Something that is more relevant to humanity. Like protein…

Gridcoin is a cryptocurrency where you earn it by lending your computing power to help scientific studies

Re: One Bitcoin miner is buying 20,000 16nm wafers from TSMC per month

#178

Post by toomuchtodo »

erentz wrote: post #174
blackrock wrote: post #129

The amount of waste of Bitcoin Mining is incredible. It is all about virtual digital mining, which is to race to find the first hash, that has X number of zeros in the front of it. And this burns an incredible amount of electricity. And all for what? Just to show proof of work. Can't there be a more useful usage of cryptocurrency mining to show proof of work? Something that is more relevant to humanity. Like protein…

People keep saying this. But are have you also thought about how wasteful is Facebook or Instagram or Youtube are? Do you know how much electricity Facebook burns running computers to serve fake images and shitty news? Or Youtube serving Logan Paul videos? If we really care about the environment we wouldn't be playing this game of trying to say one kind of environment destroying energy consumption is okay but another…

Facebook, Google, and Amazon all buy renewable energy for their computing operations through the use of power purchase agreements.

Re: One Bitcoin miner is buying 20,000 16nm wafers from TSMC per month

#179

Post by jiggunjer »

lalaland1125 wrote: post #149
blackrock wrote: post #129

The amount of waste of Bitcoin Mining is incredible. It is all about virtual digital mining, which is to race to find the first hash, that has X number of zeros in the front of it. And this burns an incredible amount of electricity. And all for what? Just to show proof of work. Can't there be a more useful usage of cryptocurrency mining to show proof of work? Something that is more relevant to humanity. Like protein…

It is impossible to create a "useful" PoW. The issue comes down to incentives. As bitcoin is a decentralized, trust-less system, there needs to be constant and powerful incentives to prevent miners from cheating (by creating forks, or executing any number of other attacks). The current main incentive against cheating is that miners will lose their invested PoW (compute time + electricity) if they cheat and get their…

One could structure it such that a single PoW is useless, yet multiple aren't? Like pieces of a puzzle that only make sense once you collect many of them.
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