381–390 of 463 posts
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> common for a wannabe Bitcoin millionaires to run mining software on computers and electricity they do not own or pay for Define “common” and provide sources for your claims please.
Monero Javascript miners are common to this day.
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Buy $10M worth of bitcoin, and then sell it again the next day, and we'll see how much you lost (on average). I'd guess you'll lose far more than doing the same with gold, because the market slippage due to lack of liquidity far exceeds the cost of those vaults, banks, and guards.
This is not true. I used to be a professional market maker in Bitcoin. This year, Bitcoin market is relatively calm in at least half of the time, meaning 12 hours out of a 24-hour day, longer than most established equity market. Under these normal conditions, trading $1m worth of Bitcoin moves the market by less than 0.01%.
A trade of $10M, or 1250 bitcoins, would move the market by 6%
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From the point of view of the miner, they have a supply of electricity at a certain price and can decide what to do with it. They might run their TV, computer, heating, industrial machinery, datacenter, or a bitcoin miner. They have to compute what profits can each of the options give them. If running bitcoin miners at that electricity cost and at that profit they can get from selling the bitcoins is more profitable…
If bitcoin is the dominant currency, another option exists: 51% attack, double-spend to get free electricity. This is useful even when it makes an apparent loss by damaging trust in the currency: If you are, say, the USA president and you’re at war with Iraq, and Iraq uses bitcoin, you can outspend on energy until they surrender. Unless the whole world uses bitcoin, but then the first few nations individually face th…
And 51% attack has the designed side effect that all other people stop using the currency - they may keep following the previous fork without the double-spend - as shown by ETH and ETC. You'd also need some way of forcing all participant to stay with the now corrupted currency. Otherwise the attacker who performs 51% attack will gain the ownership of a network that immediately becomes completely worthless.
The most powerful supercomputer in the world reaches 143 petaflops, bitcoin network in comparison reaches 80704290.84 Petaflops. Granted that a majority of this computing power is in the form of custom ASIC's, but the figure is really staggering. And all of the 80704290.84 Petaflops, consume 73.12 TWh to repeatedly calculate SHA256 ! What could be the world's most powerful network does absolutely nothing but crunch h…
It's incredible that people on HN, a technical readership, still don't understand why the energetic or computational "waste" of proof-of-work is needed. There is simply no other known way of implementing a decentralized, censorship-resistant, robust digital currency. Without PoW you lose one of these properties. Proof-of-stake doesn't work. It isn't robust. Eg. PoS cryptocurrencies can't resolved which chain is corre…
Then Ethernet came. Anyone remembers the dumb hubs? when a computer wanted to send a message, the hub actually broadcasted it to all computers in the network... so inefficient, and yet, it served its purpose.
Later, came the network protocols. There was this protocol used for discussion groups/news, remember NNTP? wasteful, because nodes had to download / replicate the full history of posts. But still... served its purpose for its time.
Then came a messaging protocol, SMTP, very useful for sending "electronic mail", very convenient. But people started sending binary data files on it... by converting it to text (UUEncoding anyone?) so wasteful and inefficient. But it is still being used.
So, bitcoin for me is just that early system, that early test that shows a way to do decentralized, censorship-resistant, digital currency. Humanity will find more efficient ways to do it (and maybe they won't be used, as with Email) or at some point in the distant future, the power side of the equation won't be relevant (renewable energy? nuclear? who knows). But for me, that does not change the fact that bitcoin proposition is a stepping stone for society that sooner or later will change the way people transfer value.
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I would argue all currencies are unreliable ,because they go down in value due increase of supply. Throwing 2-4% every year sounds awful
This gets repeated over and over again, but the causality of this has never been proven, as incredible as that may sound. Yes, the causality of "create too much money -> inflation" is plausible (but note the emphasis on "too much"). However, we live in a world of endogenous money, where money is largely created by commercial banks in the form of loans to private entities. When prices increase, those loans get bigger.…
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Why compare PoW with PoS if there is consensus https://xrpl.org/intro-to-consensus.html which already solved the problems of both before PoS even existed. Consensus will never have 2 chains unless someone creates one on purpose. For all others it's always clear witch chain is the correct because everyone can check for correctness. in case the consensus fails (for example serious global network problems) the consensus…
> Each participant in the network chooses a set of validators, servers specifically configured to participate actively in consensus, run by different parties who are expected to behave honestly most of the time. maybe you're fine with that, i'm not and everybody who values bitcoin aren't either. it's the kind of thing that PoW solves and PoS doesn't. every PoS system i've seen just obfuscates this glaring hole instea…
It's not like your node would copy their validation and just agree with what they agree. Every node always enforces all the rules. So your node checks if a Tx is valid anyway and if you get invalid Tx from a node you trust it wont make your node accept that Tx. But it should make you overthink whether that node is trustable.
Trusting nodes is a "reliability rating thing" it doesn't really affect the consensus decisions because Tx are either valid or aren't. The consensus that must be found is only about the order of Tx. If the majority of the validators say Tx X was first and therefore Tx Y is invalid (attempt to double spend) but your node got Tx Y first then its totally fine to flip the order of these two since both are valid just not at the same time.
"Voting" which nodes you trust means you trust them to be reliable/fast and not controlled by a single entity or controllable by a single entity (gov.) So with a clever trust list you help decentralize the network and help that the network runs on the most reliable nodes. You don't change the rules or allow other to change the rules. You can even make mistakes. You can choose some nodes that turn out to be not reliable/fast or even actively malicious. It has no fatal effect and can be corrected as soon as it is detected. Only if everyone would select over 20% "bad" nodes it could halt the consensus. Still would not allow a single false Tx or a single Tx reverse. It would just stop until some nodes remove the bad actors form their trust list.
As your quotes says "...run by different parties who are expected to behave honestly most of the time." The "trust" you give them is very very very limited.
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No, we can’t agree on that. The problem is the impact these things have on the rest of us when we ourselves have no interest in bitcoin. If bitcoin existed purely inside a virtual world — say, if coin miners were a virtual good that WoW players could buy which made WoW money appear in their inventory according to similar rules but without the actual hard work of computing anything beyond a lightweight O(num_players)…
Are my christmas lights that I put on during winter also everyone else's problem because they waste energy (that I bought with my own money)? Are you going to get into my business there as well and tell me what I can and cannot spend my resources on, because you claim that they have an "impact on you and you have no interest in them"? I am pretty sure that the best consensus the western world has come up with is that…
Yes but too little to bother about. Transportation and inefficient heat management are the only common ones that matter.
> they can simply be taxed in like for example a carbon tax
On that we agree. I believe car fuel is taxed appropriately in the UK, but in general these externalities are not properly accounted for. If they were, it would be a different matter, but they’re not.
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I see no benefit in a trustless currency: If I have no trust in a currency, why should I trust the goods/services? I see no benefit in a decentralised currency: gold is one (anyone can mine it) and there’s a reason we moved away from it. I don’t buy that bitcoin is either decentralised (they who control the algorithm steering committee control the currency); trustless (why should I trust irreversible transactions? Wh…
Trustless currency means exactly the opposite of what you think. It means you don't need to trust anyone, because everything can be proven and verified mathematically without any authoritative figure that you'd have to trust. That's why you can trust the system itself. And I'm sorry, I won't address your other points.
Let’s say I buy a widget. How can I trust that the widget will arrive? That it will do what widgets do? That it will not break? None of these are payment issues, but they might call for a refund. How can I get a refund? How can the refund system be resistant to abuse?
The answers we currently have are “the law”. If the law functions, I don’t need a trustless currency.
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If bitcoin is the dominant currency, another option exists: 51% attack, double-spend to get free electricity. This is useful even when it makes an apparent loss by damaging trust in the currency: If you are, say, the USA president and you’re at war with Iraq, and Iraq uses bitcoin, you can outspend on energy until they surrender. Unless the whole world uses bitcoin, but then the first few nations individually face th…
There is no such thing as speculation by mining - if they wanted to speculate but didn't profit from the mining itself, it would be better for them to speculate by buying - instead of giving dollars to the power company, they'd just give them to other people on the exchange. Basically the only reasons for miners to "speculate" are long term contracts like lease contracts for warehouses. And those may or may not be lo…
That’s my point. That is literally the point. That is why it is a bad thing and why no sane nation would ever allow it to become their main currency. It is an attack surface. It is a vulnerability to your economy.
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Miners more or less entirely pay the cost with the blockreward which means the users pay way way less fees for their Tx than it would actually cost in energy. If we assume max 7Tx/s 1 block can hold 4200 Tx One block gets the miner 12.5 BTCs that's a 0.003 BTC "subvention" per Tx that would otherwise have to be pais as fee. In other words the cost is paid by inflation which hurts most who holds and not who uses it. P…
Miners are not paying their electricity bills with bitcoin (most of them). It's the other buyers, that buy the bitcoins from the miner in exchange for dollars, that in fact pay the bills. And those are willing to pay the current price of electricity required to create the block. And mining costs have gone down before. It's when bitcoin's price falls making mining unprofitable, so some miners stop, which lowers the di…
That true, mining cost can go down and it did but in the long run it can (must) only go up.
If we assume after block reward is gone or very low, fees pay miners less so most miners stop and difficulty is adjusted then we have a imminent 51% attack risk. Low difficultly, bankrupt miners, mark flooded with cheap mining hardware and suddenly drooping energy prices are the perfect conditions for such an attack. Once attacked the price drops pushes more miners out of business and attacks are even cheaper. A crash is inevitable.