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El Salvador Plans to Use Electricity Generated from Volcanoes to Mine Bitcoin

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Re: El Salvador Plans to Use Electricity Generated from Volcanoes to Mine Bitcoin

#131

Post by ajkdhcb2 »

JamilD wrote: post #119
enchiridion wrote: post #79

So, I'm going to choose to be an optimist when it comes to crypto energy consumption. There has literally never been a more direct reward for efficient energy production.

Why is this a more direct reward than generating energy to sell? In mining, revenue = efficiency * potential energy * BTC per unit produced energy In selling energy, revenue = efficiency * potential energy * USD per unit produced energy I don’t see the difference, other than the fact the former just adds to the pool of required energy (it’s strictly additive to the energy produced by the second)

Transporting power is extremely expensive and infeasible over large distances. So power needs to be generated near industry or homes. However, cryptocurrency can be mined anywhere and then sold.

Re: El Salvador Plans to Use Electricity Generated from Volcanoes to Mine Bitcoin

#132

Post by ipaddr »

thehappypm wrote: post #121

One interesting thing to me is that Bitcoin is a lot easier to steal than money in banks. A bad actor can steal your private key and take all of your BTC, and it's gone forever. Try doing that with a bank account -- the bank will back you up, there are transfer limits.

How does this apply? This makes it easier for others to steal all of the money? I would think they would be selling those coins after mining them not holding on to them as some future investment.

Nevermind that banks in smaller countries can be a huge source of thief.

Re: El Salvador Plans to Use Electricity Generated from Volcanoes to Mine Bitcoin

#133

Post by rawtxapp »

cratermoon wrote: post #105
lucb1e wrote: post #37

Almost half the electricity produced in El Salvador is from fossil sources (they don't have nuclear power): https://data.worldbank.org/indicator/EG.ELC.PETR.ZS?location... Option A: invest in that volcano and reduce greenhouse gas emissions. Option B: invest in that volcano and mine bitcoin. B makes them richer so long as other people keep expecting Bitcoin prices to rise (increasing demand), so I can see why they do…

> B makes them richer B makes the colonizing foreign investors richer. It won't do shit for the poor country.

Are you referring to the fact that their currency is USD which they don't control therefore can be pushed around by the USG?

Re: El Salvador Plans to Use Electricity Generated from Volcanoes to Mine Bitcoin

#134

Post by beiller »

cs702 wrote: post #122

The country is already going all-out in its adoption of Bitcoin, so sure, why not go from "ludicrous" to "plaid" by bringing volcanoes into the mix?[a] For those not living in El Salvador, it will be fascinating to see how this unorthodox approach to monetary policy works out in the end. [a] https://www.youtube.com/watch?v=VO15qTiUhLI

Yeah. How can a country survive without unlimited QE? The poor residence will see their buying power constantly rise against all other currencies as the other countries of the world follow in USA's footsteps of unlimited manipulation. Realistically that might actually be tough for any of their exports however and may make everyone unemployed as their "currency" rises in value, but will they also all be rich? Frankly I think it is an amazing experiment.

Re: El Salvador Plans to Use Electricity Generated from Volcanoes to Mine Bitcoin

#135

Post by ajkdhcb2 »

legutierr wrote: post #26
garydevenay wrote: post #10

Earlier quoted context omitted.

In the case of laundering Bitcoin— this seems to be a majorly misunderstood concept. Bitcoin transactions are completely transparent and observable by everyone who has an internet connection. Anyone (with an internet connection) can watch any wallet and observe any and all transactions. The notion of a country being a "good location for laundering bitcoins" doesn't really make sense, as Bitcoin are never in a locatio…

Are lightning transactions completely transparent?

The transactions pass through generally only 1-2 nodes which will be required to log everything unless they want to risk punishment for laundering illegal BTC, and people dont want to close their channel and end up with illegal BTC without evidence of how it happened, so yeah. There are huge problems with trying to build fungibility on top of a traceable foundation.

Re: El Salvador Plans to Use Electricity Generated from Volcanoes to Mine Bitcoin

#136

Post by fnord123 »

pocoloco wrote: post #129

As a Salvadoran living abroad but keeping an eye on politics there, I feel the need to comment given the amount of skepticism shown here, which is understandable given the history. I believe that what the president, Nayib Bukele, and his team have done is monumental. The reason is that I also believe that the financial system crashed back in 2008 and has been kept alive by central banks worldwide. Last summer we saw…

> Mandating BTC as legal tender is an awesome move. To me the most important benefit is that the 70% of the population which was excluded from banking and relegated to use physical currency will now be included. If the economy is an engine and money is the oil, El Salvador, which had only some drops of oil, will now get a complete oil change with synthetic on top of that.

You are 100% incorrect. Bitcoin is wildly deflationary. Therefore it does not encourage an economy to function, it encourages people to hold onto it with white knuckles. It's not oil for the economy, it's sand.

> This means that the government now has to provide connectivity to all citizens and teach them.

And when they don't provide connectivity and teach citizens?

Re: El Salvador Plans to Use Electricity Generated from Volcanoes to Mine Bitcoin

#137

Post by lucb1e »

29athrowaway wrote: post #117
cratermoon wrote: post #105

Earlier quoted context omitted.

> B makes them richer B makes the colonizing foreign investors richer. It won't do shit for the poor country.

When a government... 1) owns a profitable state company 2) that does not require the cooperation of the population in order to be profitable ...the result is a dictatorship. https://www.youtube.com/watch?v=rStL7niR7gs

That sounds a lot like Norway though, didn't they have this massive amount of money from some natural resource (oil I think) and made a big pension fund for the population?

There are obviously also counter-examples, but a currently-democratic country finding a new way to make money from natural resources, I wouldn't expect we have a large enough sample size to really say anything about that with certainty.

Edit: The Norway thing being (for those interested):

> [The oil fund] was established in 1990 to invest the surplus revenues of the Norwegian petroleum sector. It has over US$1.3 trillion in assets, including 1.4% of global stocks and shares, making it the world’s largest sovereign wealth fund. In May 2021, it was worth about $248,000 per Norwegian citizen.

https://en.wikipedia.org/wiki/Government_Pension_Fund_of_Nor...

Re: El Salvador Plans to Use Electricity Generated from Volcanoes to Mine Bitcoin

#138

Post by IfOnlyYouKnew »

enchiridion wrote: post #79

So, I'm going to choose to be an optimist when it comes to crypto energy consumption. There has literally never been a more direct reward for efficient energy production.

> There has literally never been a more direct reward for efficient energy production.

Not having to pay for the inefficiency in producing the energy you actually needs seems to be... more direct?

Re: El Salvador Plans to Use Electricity Generated from Volcanoes to Mine Bitcoin

#139

Post by cartosso »

I can't believe people still don't see the obvious issue that PoW has no sense and it's impact gets progressively worse as the market cap of BTC increases. The more adoption BTC will have, the more incentive will powerful entities have to take part in mining (obvious analogy: US dollar, the people who control it have the most power in the global financial system). Also, the more valuable BTC becomes, the more new miners will join in the mining race, since the average payout per kWh spent should stay at a relatively constant % of market cap. Both of this observations lead to the clear conclusion that energy spent on useless hash cracking will continue to increase, which is just plain stupid. Humanity cannot afford to waste energy in such an obviously non-nonsensical way; if you want to keep the crypto train going, fine, but at the very least switch to PoS.

Re: El Salvador Plans to Use Electricity Generated from Volcanoes to Mine Bitcoin

#140

Post by rawtxapp »

JamilD wrote: post #120
randomhodler84 wrote: post #114

Earlier quoted context omitted.

I’m sorry you don’t see that it has value. It has value to me. In fact, I need a secure, permissionless, censorship resistant, non-state backed value storage system more than I need hydroponic food or desalinated water. The problem is the disconnect between your wants/needs and the needs of others in the world. Waste is entirely in the eye of the beholder.

Are the benefits of proof of work worth the additional cost over other consensus algorithms, to you?

PoW keeps things fair, you have to spend money on hardware and energy or become irrelevant.

In other consensus systems like PoS, whoever has the most capital controls pretty much everything and has 0 incentive to sell what they get since they aren't really spending any energy for their cryptographic signature.

It literally says "rich gets richer" in the protocol which is fundamentally broken in my humble opinion.

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