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Bitcoin mining hash rate drops as blackouts instituted in China

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Re: Bitcoin mining hash rate drops as blackouts instituted in China

#261
post #92

Earlier quoted context omitted.

Without the bitcoin driven demand, there would be less pressure to mine faster than feasible and fewer accidents. The pressure would still be there... but there are cost-related reasons the mining is colocated with the power generation. Seems a reasonable guess that this virtuous cycle of coal-and-crypto mining synergy resulted in some soylent externalities.

I guess we should think about what percent of the power was used for bitcoin mining. If only 1% was used for bitcoin mining that it's pretty hard to say that bitcoin mining was the cause.

Bitcoin mining consumes about 0.6% of global electricity consumption [0]. According to TFA, global mining dropped by 50% from the issues above, so 0.3% of global electricity consumption is in China. China in total produced 5920 TWh in 2016 (last year I could easily get data [1]), out of a global total of 21877 TWh in that same year [2]. China's been growing faster than global trends, but that means that in 2016 they generated ~27% of global electricity (5920/21877). That means your ballpark of about 1% of China's power generation being used on bitcoin (0.3%/27%) is pretty spot on.

[0] https://techcrunch.com/2021/03/21/the-debate-about-cryptocur.... [1] https://en.wikipedia.org/wiki/Electricity_sector_in_China [2] https://www.statista.com/statistics/280704/world-power-consu...

Re: Bitcoin mining hash rate drops as blackouts instituted in China

#263

Earlier quoted context omitted.

How is Bitcoin a boon to renewables? Bitcoin consumes energy, and that energy is not being used for other things. Taxing one form of energy will just mean everything that uses energy becomes more expensive; Bitcoin fees would rise or mining operations would simply move to places without the tax. The actual problem is that Bitcoin's incentive structure works against energy efficiency. Usually we would expect to see im…

> How is Bitcoin a boon to renewables? Bitcoin consumes energy, and that energy is not being used for other things. The utopian view is that not all energy is currently being used for other things. On grids with heavy penetration of renewables, peak production can overwhelm demand, causing bulk power to become effectively free. In a suitably regulated environment, bitcoin or an equivalent could act as a last-resort u…

...or we could work on better energy storage and distribution technologies and move away from "base load" approaches to power generation. I am also not seeing how Bitcoin, which consumes power regardless of whether or not there is any excess, helps in any way. Why do you think Bitcoin miners would shut their operations down during periods of high demand in any regulatory environment, other than one which specifically punishes Bitcoin miners (in which case, why should anyone think Bitcoin would continue to exist)? Bitcoin would just push up the floor on how much electricity must be supplied at any given time.

Re: Bitcoin mining hash rate drops as blackouts instituted in China

#265
post #260

Earlier quoted context omitted.

That may be true, but the toothpaste is out of the tube. If we can't abruptly stop the use of fossil fuels to stop climate change, I don't think any amount of pointing out how much energy BTC uses is going to change the fact that it's been well established.

Although I believe it is well-established, there's still a lot of people spreading industry talking points about how it's mostly renewables, in spite of stories like this to the contrary. Motivated reasoning is a helluva drug.

Bitcoin is an experiment to see if humans will set fire to their own house while they're living in it for a quick buck. The answer is: yes

Re: Bitcoin mining hash rate drops as blackouts instituted in China

#266

Earlier quoted context omitted.

Also a good time to point out that there are energy efficient blockchains that work differently from bitcoin -- not all crypto is as power hungry (some use disk space, or memory, or even just the tokens themselves to replace bitcoin's proof of work model).

Heat generation really is the stupidest way of doing things. With things like storage, at least you can reuse it after the fact. Tho, all these systems require some ressource scarcity and will inherently maintain/promote scarcity. This is completely unacceptable in the coming years. People don't realize how much we need to cut back on natural ressource extraction and energy expenditure. Out whole world is build on ma…

> It's madness to use any unnecessary energy or resource on crypto finance, when there are more energy efficient alternatives.

Agreed. Cryptocurrencies that use proof of stake are a great alternative to cryptocurrencies that use natural resource scarcity.

Re: Bitcoin mining hash rate drops as blackouts instituted in China

#267
post #170

Earlier quoted context omitted.

That’s true. But it’s important to point out that proof-of-work (PoW) is more decentralized than e.g. proof-of-stake (PoS). For example, with PoW you only need a single honest node to arrive at the correct chain during initial sync. With PoS there is no such guarantee, since there’s no inherent way for a new node joining the network to decide which chain to pick when presented with two different, but equally valid, c…

>But it’s important to point out that proof-of-work (PoW) is more decentralized than e.g. proof-of-stake (PoS). The opposite is true in multiple aspects. PoW has infinite economies of scale which inevitably leads to total centralization as all miners but the most efficient one have to shutdown. PoS can stay decentralized forever because new stakers arriving aren't going to make existing staking unprofitable, forcing…

I've been mining for about 4 years now (1btc/month and 35-40eth/month since March 2017), and this is the first time I've heard someone trying to say PoS would lead to MORE decentralization. To be fair, I don't regularly converse online with other miners. I mean, I see what your arguments are here, but I'm just not sure I agree.

Usually the only people trying to promote PoS are the ones who are financially well-off enough to buy the masternodes. You could make the same argument for mining -- to do it on any worthwhile scale you better be prepared to spend a minimum of $500k -- but "worthwhile" is subjective, and some people are fine only making a residual income off of their mining, because they feel like they are contributing to the "cause" -- to keep the network flowing -- amongst other reasons. Initially, I got started with mining out of pure idealism about decentralization, anonymous currencies, and the cypherpunk roots of it all. That turned into me making significant investments to mine on a larger scale. Maybe people doing it for those reasons will be less important as time goes on and it's more mainstream...I don't know.

My other business is legal MJ cultivation in California and Michigan, and it's the same thing in that industry -- the only people wanting, or not minding, the expensive licensing and startup costs in California are the well-financed companies who can afford it all, who can wait many years for profits if necessary. Everyone else wants a way for easy entrance in the market, low licensing costs, etc.

As for government interference, I was a "traditional market" operator for ~14 years in the MJ business, and have experience with avoiding scrutiny from the government. In fact, the issues with bitcoin mining are identical to that of growing marijuana on a large scale -- exhausting large amounts of heat, the intake of large amounts of fresh air or cooling BTU's, using large amounts of electricity, the need for good airflow in the facility, etc. With that said, you could structure your mining operation so that only a very targeted, focused investigation could find you -- it wouldn't be easy to "fish" and find it. For example, the main indicator would be the electricity usage, but there are tons of legitimate businesses that use far more electricity than a mining operation. Establish a business that is in that industry, buy a warehouse for that purpose, get your electrical installed, and then run all your miners through your own VPN or Tor (I've never tried to run them on Tor, because I was always worried about speed/connection problems.) They would see large electrical usage, yes, but that is normal for your registered business.

In this hypothetical government overreach scenario, hiding a mining business -- if you really had to -- wouldn't be any more difficult than hiding a large scale grow operation, or a meth lab, or anything illicit really. You just have to know what you are doing, but people have been doing this for decades and decades without problem.

Re: Bitcoin mining hash rate drops as blackouts instituted in China

#268

Earlier quoted context omitted.

The bribery can be solved with slashing and making it economically unviable to cede to bribery. Regarding plutocracy, it depends on proof-of-stake vs delegated-proof-of-stake. In one, everyone can become a staker and earnings are spread to all, in the other, some stakers are elected and earnings will be concentrated to them. Proof-of-work has inequality issues: - economies of scale for those that have the capital to…

Slashing doesn't solve anything, I don't think you've studied how the attack would work. Proof of work that doesn't solve second order byzantine fault tolerance cannot account for externalities and suffers from the issues you mention. I agree that neither "solution" is all that great, my project is neither proof of work nor proof of stake.

> I don't think you've studied how the attack would work.

It's my day job to implement proof-of-stake https://github.com/status-im/nimbus-eth2/pull/865

Re: Bitcoin mining hash rate drops as blackouts instituted in China

#269

Earlier quoted context omitted.

Also a good time to point out that there are energy efficient blockchains that work differently from bitcoin -- not all crypto is as power hungry (some use disk space, or memory, or even just the tokens themselves to replace bitcoin's proof of work model).

Heat generation really is the stupidest way of doing things. With things like storage, at least you can reuse it after the fact. Tho, all these systems require some ressource scarcity and will inherently maintain/promote scarcity. This is completely unacceptable in the coming years. People don't realize how much we need to cut back on natural ressource extraction and energy expenditure. Out whole world is build on ma…

I agree on everything you said, but I have the suspect that if we untapped an unlimited energy source that would quickly put a (near) expiration date on our civilization, and maybe on our planet. Scarcity is necessary to maintain balance.

Re: Bitcoin mining hash rate drops as blackouts instituted in China

#270
post #265
post #260

Earlier quoted context omitted.

Although I believe it is well-established, there's still a lot of people spreading industry talking points about how it's mostly renewables, in spite of stories like this to the contrary. Motivated reasoning is a helluva drug.

Bitcoin is an experiment to see if humans will set fire to their own house while they're living in it for a quick buck. The answer is: yes

I'd say it's one of a great many successful replications of that experiment.
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