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Bitcoin Energy Consumption Index

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101–110 of 295 posts

Re: Bitcoin Energy Consumption Index

#101
post #78
post #60

Earlier quoted context omitted.

>The correct comparison would be to compare the cost of Bitcoin to U.S. dollars or gold. Gold requires hundreds of dollars per ounce and untold energy to extract. U.S. dollars require the existence of a powerful economy and trillion dollar military to keep the currency secure and desirable. No it isn't- the energy cost of bitcoin is ongoing and depends on the volume of transactions. Each time money changes hands, it…

If read the article correctly, he's including the cost of mining Bitcoin, not merely energy cost to verify a coin (which is absolutely trivial). Once all Bitcoin is mined (yes, there's a built-in maximum), or it becomes prohibitively expensive to mine, there won't be any mining costs. You can look at the current Bitcoin energy costs as the startup cost to establish a new gold mine or a new country with its own curren…

Mining always needs to happen. Once it stops producing coins, the cost burden just moves over to the people using the currency. The mining cost only decreases if the proof-of-work difficulty decreases.

If mining becomes less profitable, fewer people will mine and the proof-of-work will tune to be less difficult, but the cost never disappears and there's still a huge amount of energy wasted in the selection process for adding blocks. If too few people mine the currency will be totally destabilized.

Re: Bitcoin Energy Consumption Index

#102
post #93
post #78

Earlier quoted context omitted.

If read the article correctly, he's including the cost of mining Bitcoin, not merely energy cost to verify a coin (which is absolutely trivial). Once all Bitcoin is mined (yes, there's a built-in maximum), or it becomes prohibitively expensive to mine, there won't be any mining costs. You can look at the current Bitcoin energy costs as the startup cost to establish a new gold mine or a new country with its own curren…

> Once all Bitcoin is mined (yes, there's a built-in maximum), or it becomes prohibitively expensive to mine, there won't be any mining costs. In that future you will still mine blocks, but there won't be any new bitcoin generated in that block. Sure, you might want to use a different word for that than "mining", but it will still have very real and significant energy.

"Validators" is the more generic for term what are also called miners or stakers.

Re: Bitcoin Energy Consumption Index

#103
post #83

The energy expended is a guarantee of security and immutability. The fact that real world energy is expended is the thermodynamic guarantee of the irreversibility of a transaction. If you have access to the VISA database, and change something, you cannot have the cryptographic proof that it has not been tampered with. At the very best, you trust a VISA root key. With Bitcoin you trust math and physics, telling that i…

I get that the energy is being used for something useful and cool, but when the energy cost to secure a single transaction could power 5 households for a day, then something is wrong and needs to be fixed. Surely even fans can agree there's a level at which it just doesn't make sense any more.

> something is wrong and needs to be fixed

It's already fixed with PoS... IMO the winner of the cryptocurrency-race will be a PoS-based coin.

Re: Bitcoin Energy Consumption Index

#104
post #83

The energy expended is a guarantee of security and immutability. The fact that real world energy is expended is the thermodynamic guarantee of the irreversibility of a transaction. If you have access to the VISA database, and change something, you cannot have the cryptographic proof that it has not been tampered with. At the very best, you trust a VISA root key. With Bitcoin you trust math and physics, telling that i…

I get that the energy is being used for something useful and cool, but when the energy cost to secure a single transaction could power 5 households for a day, then something is wrong and needs to be fixed. Surely even fans can agree there's a level at which it just doesn't make sense any more.

Yes, there is a level at which it doesn't make sense any more. In a sufficiently efficient market, that is the point we are at, at any given point in time.

I believe the bitcoin mining market is efficient enough already that we're more or less there.

Re: Bitcoin Energy Consumption Index

#105

That is an absurd amount of energy. This really changes my opinion on this being a feasible currency.

The energy expended is the security of the currency.

If a transaction is confirmed by 1 TWh of proof of work, that much energy is required to alter it, meanwhile the bitcoin network has expended even more energy.

It is still young, and the exponential growth in energy consumption is going to stop as an equilibrium is reached.

Re: Bitcoin Energy Consumption Index

#106
post #97
post #9

Apparently "terawatt-hours per year" is a unit that people use in public policy, but it strikes me as strange. Converting 16.22 TWh/year to a "more metric" unit, that's a sustained power usage of 1.85 gigawatts. So Bitcoin is constantly using more than enough power to make Doc Brown's eyes bug out.

I too hate seeing __ watt-hours per year. What's the point of the double time conversion? It's like saying "The movie starts in 3 kilometers per mile-per-hour"

I mean, I understand why, it's because often you want to relate it to cost, and electricity is priced in $/KWh, not in ($/sec)/watt.

Re: Bitcoin Energy Consumption Index

#107
post #89
post #60

Earlier quoted context omitted.

>The correct comparison would be to compare the cost of Bitcoin to U.S. dollars or gold. Gold requires hundreds of dollars per ounce and untold energy to extract. U.S. dollars require the existence of a powerful economy and trillion dollar military to keep the currency secure and desirable. No it isn't- the energy cost of bitcoin is ongoing and depends on the volume of transactions. Each time money changes hands, it…

This is very wrong. It does not work that way at all. Volume or value of transactions has nothing to do with the energy expended. The energy is needed to calculate a mathematic proof that makes sure your transaction cannot be reversed or tampered with. This mathematic proof on average is calculated every 10 minutes, with no correlation to the number of transactions. You make a transaction, and if the bitcoin network…

The hashing is merely a way to choose a random block. It's not a proof and it doesn't do anything fancy. It just picks a random computer to say "this is how the transaction history looks".

The energy increases with the volume of transactions because there will be more people calculating hashes. The more people mining, the harder they make the hash calculation so that the target is ten minutes. More transactions = more people mining because there is more demand to verify blocks.

Re: Bitcoin Energy Consumption Index

#108

Earlier quoted context omitted.

> Gold requires hundreds of dollars per ounce and untold energy to extract. A valid comparison. Gold mining is spending resources to increase the amount of gold in existence, without delivering any other value. > U.S. dollars require the existence of a powerful economy and trillion dollar military to keep the currency secure and desirable. Not a valid comparison. Outside of a few relatively inexpensive activities at…

Note that bitcoin mining does not primarily exist to increase the amount of bitcoin in existence. That's just part of the incentive to mine. Bitcoin mining exists to timestamp transactions so that the network can achieve consensus on the state of the ledger. It is designed to use as much energy as possible, so as to make it expensive to cheat.

In fact, in the white paper it's just described as the decentralized time stamp server and that's its entire purpose. The term "blockchain" and all the hype about its magic powers came later.

Re: Bitcoin Energy Consumption Index

#109
post #44

You can't compare Bitcoin to Visa. Visa is merely a payment sytem -- a means of transfer of money that already exists. Visa is not money. Bitcoin however is money. As well as being a payment system. The correct comparison would be to compare the cost of Bitcoin to U.S. dollars or gold. Gold requires hundreds of dollars per ounce and untold energy to extract. U.S. dollars require the existence of a powerful economy an…

Compare it to cash and coins seems the most appropriate. How much energy does harvesting cotton, making into bills, and distributing it all over the place take? Don't forget those fun armoired trucks that have to cart it from place to place. Pennies famously cost more than $0.01 to produce because of the cost of metal. Metal that has to be dug out of the earth, trucked, smelted, trucked, stamped, trucked again.

A literal comparison to paper bills isn't quite right. A small sheet of linen/cotton paper could represent $1, $100, or hundreds of millions of dollars (eg., a stock certificate of a million shares of Apple stock).

You have to compare Bitcoin to the concept of money, like U.S. dollars, but not literally the paper. A comparison to bars of gold is OK however since that is money and not a representation.

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