Jack Dorsey says Square is ‘considering’ building a Bitcoin mining system
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Re: Jack Dorsey says Square is ‘considering’ building a Bitcoin mining system
#2Dorsey's giving out some narrative of reducing pollution by making mining more efficient. This has to be him just saying things the media wants to hear, because that simply doesn't work.
The pollution generated by bitcoin is not a factor of mining efficiency, its a factor of its price.
When bitcoin reaches $100,000, its pollution will be roughly equivalent to the pollution created from making $100,000 worth of energy. Obviously this is a rough estimation, but its pretty close. As a miner, if it only costs $80,000 in energy to produce one bitcoin, and you can sell it for $100,000, then you're gonna crank up the heat until you're closer to breaking even. So when 1 bitcoin reaches $1,000,000 it will take roughly $1,000,000 worth of energy to mine, and thereby create the pollution equivalent of $1,000,000 worth of energy.
Kind of makes you wonder if nakamoto saw this as a property of bitcoin, because that is one helluva cost if you think about it.
Re: Jack Dorsey says Square is ‘considering’ building a Bitcoin mining system
#3"2/Mining needs to be more efficient. Driving towards clean and efficient energy use is great for Bitcoin’s economics, impact, and scalability."
This seems like Dorsey doesn't understand how Bitcoin works, which is surprising
Making a more efficient miner will not reduce energy consumption, no more than designing lightweight bricks would allow you to build cheaper bank vaults
Re: Jack Dorsey says Square is ‘considering’ building a Bitcoin mining system
#4Dorsey's giving out some narrative of reducing pollution by making mining more efficient. This has to be him just saying things the media wants to hear, because that simply doesn't work. The pollution generated by bitcoin is not a factor of mining efficiency, its a factor of its price. When bitcoin reaches $100,000, its pollution will be roughly equivalent to the pollution created from making $100,000 worth of energy…
If the energy comes from a clean source, what does it matter? I think Dorsey believes that if there were cost effective mining equipment that requires little maintenance and is simple to maintain, you'd be able to use it in places that have abundant cheap and renewable resources. The cheapest forms of power are likely the ones that are going to go to waste anyway. Sure you'll still bid up the price you consume, but that's the point of the difficulty adjustment. The more valuable the network, the more valuable prize for a 51% attack. So you have to rely on market forces to ensure the network remains secure
Re: Jack Dorsey says Square is ‘considering’ building a Bitcoin mining system
#5Dorsey's giving out some narrative of reducing pollution by making mining more efficient. This has to be him just saying things the media wants to hear, because that simply doesn't work. The pollution generated by bitcoin is not a factor of mining efficiency, its a factor of its price. When bitcoin reaches $100,000, its pollution will be roughly equivalent to the pollution created from making $100,000 worth of energy…
If the energy comes from a clean source, what does it matter? I think Dorsey believes that if there were cost effective mining equipment that requires little maintenance and is simple to maintain, you'd be able to use it in places that have abundant cheap and renewable resources. The cheapest forms of power are likely the ones that are going to go to waste anyway. Sure you'll still bid up the price you consume, but t…
The opportunity cost means there is effectively no difference. A megawatt hour used to mine from a clean source means that a megawatt hour used for something else doesn't come from a clean energy source. Even if this project is the difference between building additional clean energy capacity or not, the resources for building that capacity have an opportunity cost—something that can't be built that would create value. Mining cryptocurrency doesn't create wealth any more than mining gold or printing money, it creates value in a zero sum manner, by discounting the value of all other currencies by a very tiny amount.
Re: Jack Dorsey says Square is ‘considering’ building a Bitcoin mining system
#6Ultimate censorship will be the legacy of Censorship Jack.
Re: Jack Dorsey says Square is ‘considering’ building a Bitcoin mining system
#7Dorsey's giving out some narrative of reducing pollution by making mining more efficient. This has to be him just saying things the media wants to hear, because that simply doesn't work. The pollution generated by bitcoin is not a factor of mining efficiency, its a factor of its price. When bitcoin reaches $100,000, its pollution will be roughly equivalent to the pollution created from making $100,000 worth of energy…
Square has written a memo titled "Bitcoin is Key to an Abundant, Clean Energy Future". What are your thoughts on the piece?
Re: Jack Dorsey says Square is ‘considering’ building a Bitcoin mining system
#8Dorsey's giving out some narrative of reducing pollution by making mining more efficient. This has to be him just saying things the media wants to hear, because that simply doesn't work. The pollution generated by bitcoin is not a factor of mining efficiency, its a factor of its price. When bitcoin reaches $100,000, its pollution will be roughly equivalent to the pollution created from making $100,000 worth of energy…
If the energy comes from a clean source, what does it matter? I think Dorsey believes that if there were cost effective mining equipment that requires little maintenance and is simple to maintain, you'd be able to use it in places that have abundant cheap and renewable resources. The cheapest forms of power are likely the ones that are going to go to waste anyway. Sure you'll still bid up the price you consume, but t…
I don't know which world people like Dorsey live in. There is a massive chip shortage (all over the world) and energy shortage (in China and Europe). We don't have enough energy to power homes, and there just aren't enough chips for automobiles. This got to be an absolutely worst time to start manufacturing bitcoin machines, opensource or otherwise.
Re: Jack Dorsey says Square is ‘considering’ building a Bitcoin mining system
#9"2/Mining needs to be more efficient. Driving towards clean and efficient energy use is great for Bitcoin’s economics, impact, and scalability." This seems like Dorsey doesn't understand how Bitcoin works, which is surprising Making a more efficient miner will not reduce energy consumption, no more than designing lightweight bricks would allow you to build cheaper bank vaults
Curious for your thoughts on Square's memo on this: https://assets.ctfassets.net/2d5q1td6cyxq/5mRjc9X5LTXFFihIlT...
Re: Jack Dorsey says Square is ‘considering’ building a Bitcoin mining system
#10Dorsey's giving out some narrative of reducing pollution by making mining more efficient. This has to be him just saying things the media wants to hear, because that simply doesn't work. The pollution generated by bitcoin is not a factor of mining efficiency, its a factor of its price. When bitcoin reaches $100,000, its pollution will be roughly equivalent to the pollution created from making $100,000 worth of energy…
If the energy comes from a clean source, what does it matter? I think Dorsey believes that if there were cost effective mining equipment that requires little maintenance and is simple to maintain, you'd be able to use it in places that have abundant cheap and renewable resources. The cheapest forms of power are likely the ones that are going to go to waste anyway. Sure you'll still bid up the price you consume, but t…
> If the energy comes from a clean source, what does it matter?
It matters because we don’t have enough clean energy to go around. Since energy is fungible, this means that turning on a bitcoin mine means that the energy provider has to turn on a fossil fuel plant to meet demand.
Maybe if Dorsey agreed to only run his bitcoin machines when excess renewables were available and could not be stored that would be fine. But that’s tantamount to making him promise to never make a profit overnight or when the wind isn’t blowing. I don’t trust any company to keep that promise.
> I think Dorsey believes that if there were cost effective mining equipment that requires little maintenance and is simple to maintain, you'd be able to use it in places that have abundant cheap and renewable resources.
It’s worth pointing out that e waste is a thing. Mining equipment has an environmental cost even if it’s magically efficient.
Furthermore the design of bitcoin encourages extra consumption. If Dorsey makes a machine that consumes half the energy of its competitors per hash, is he going to consume half the power, or is he going to make 2x as many of them to make double the profit? No need to answer, we already know that bitcoin farms always push to purchase as much hardware as they can in pursuit of greater hashing power.
Oh, and that hardware gets thrown away the moment a slightly better machine gets invented. Unlike server hardware, the value of a bitcoin machine drops precipitously the moment it’s no longer the most efficient. There have been some darkly humorous videos of miners giving away free oranges in china as long as you agree to take an outdated ant miner off their hands.
> Sure you'll still bid up the price you consume, but that's the point of the difficulty adjustment.
Whoops. You undermined your own point here.
> The more valuable the network, the more valuable prize for a 51% attack. So you have to rely on market forces to ensure the network remains secure
Yeah, but why do we want that? Bitcoin has utterly failed as a currency, it’s just turned into a stupid casino for people to bet on because “number go up”. Why as a society do we want to tolerate literal nation states worth of electricity “securing” a network that doesn’t really do anything useful for society?