271–280 of 319 posts
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If I have Bitcoin how do I convert it into energy to power something else?
By purchasing electricity with Bitcoin.
Even if one accepts the underlying assumption that bitcoin "store" the energy wasted on "mining" them, the theory espoused in the article simply does not hold water. If a new energy source becomes available, so 10x as much energy as before gets put into aluminum smelting, you end up with 10x as much aluminum. Bitcoin "mining" does not work that way. The computations are an artificial hurdle erected to hit a predeterm…
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Not sure it's happening as fast as you seem to indicate here. And if it is, what's the problem with Bitcoin and energy consumption, exactly the same thing will happen, but faster since Bitcoin is all about money?
It will not. Bitcoin is literally designed specifically to make sure this never happens. Again, as soon as you manage to develop a way to mine bitcoin more efficiently, the difficulty of mining will automatically go up to make sure you are still wasting just as much energy.
The point the article appears to make is that bitcoin mining is much more elastic in its energy use and is therefore uniquely fit to fill some niche energy markets.
That’s completely different from and quite a far cry from being a “battery”.
Even if one accepts the underlying assumption that bitcoin "store" the energy wasted on "mining" them, the theory espoused in the article simply does not hold water. If a new energy source becomes available, so 10x as much energy as before gets put into aluminum smelting, you end up with 10x as much aluminum. Bitcoin "mining" does not work that way. The computations are an artificial hurdle erected to hit a predeterm…
If more energy is spent on bitcoin, it is usually because the value of the miner reward grows and attracts more mining. Miner reward value grows due to either 1) the market value of the coin itself grows or 2) the miner fees grow. Both are market forces and ultimately depend on demand for bitcoin transactions. So I don’t see a contradiction here.
The difference between bitcoin and aluminum is that bitcoin values the energy not qua energy, but purely for its wasted cost, so if energy becomes cheaper overall (or hash computation becomes more efficient), you have to use more of it to create the same value for bitcoin, if it becomes more expensive, you can create the same value using less energy.
That's why I find it silly to say that bitcoin stores "energy". It stores sunk cost.
Even if one accepts the underlying assumption that bitcoin "store" the energy wasted on "mining" them, the theory espoused in the article simply does not hold water. If a new energy source becomes available, so 10x as much energy as before gets put into aluminum smelting, you end up with 10x as much aluminum. Bitcoin "mining" does not work that way. The computations are an artificial hurdle erected to hit a predeterm…
What happens when you print 10x the money... let’s see shall we, they are doing it now!
US money supply has not grown at anywhere near 10x recently: https://fred.stlouisfed.org/series/MZM
Tether supply has grown roughly 10x since January 2020, though, but that's on a blockchain, so surely everything is on the up and up: https://coinmarketcap.com/currencies/tether/
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No of course not, that reading isn't any more accurate than it would be to say that you're arguing that we should set up a Dyson sphere around our sun to black out the earth and mine Bitcoin in the vast dead emptiness of space for all eternity[0]. Be careful not to inflate arguments into completely separate positions. What GP is saying is that switching to renewables doesn't make all of the negative externalities of…
> waste power > not a battery What's a better way to losslessly and securely store human labor/time for future use? Almost everything else (fiat, gold, silver, real estate, etc...) that exists is debased/debasable, deteriorates, or loses value. The above arguments completely hinge on energy being "wasted". Lossless labor/time storage isn't "waste" to market participants seeing a need for it and putting their hard ear…
Look, yes, Bitcoin is deflationary, but it's still subject to market pressures. It's not technologically guaranteed to be worth anything 200 years from now.
Besides that...
> securely store human labor/time for future use?
It's not secure storage if you can't retrieve it[0]. What do you mean by "lossless"? You permanently lose all of the energy when you convert it into Bitcoin. You can not get that power/energy back, it is gone. What you hope is that the value of Bitcoin will allow you to trade your coins for somebody else's energy. But guaranteed scarcity is not the same thing as lossless storage, otherwise we would store all of our Youtube videos on collectable Beanie Babies.
Bitcoin's value is based on social consensus, not because it can be converted back into electricity. You're not storing anything, you are using a scarce resource to guarantee that it will be difficult to create more Bitcoin in the future, thereby creating a deflationary currency.
> Any multi-decade/multi-century solution that market participants should focus on instead?
All of them? Most currencies have been around for multiple centuries. The US dollar has been around for multiple centuries, and the US dollar is young.
Yes, the value of the US dollar can fluctuate, but, and I can not stress this enough, so can Bitcoin's value. There is no magical technology that makes Bitcoin worth anything, it's worth what people are willing to trade for it.
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Maybe a thought experiment will help here.
If you think that Bitcoin is genuinely storing energy in a lossless format independent of market pressure, then I should be able to create a new Bitcoin using the exact same technology because it's Open Source, and it should also be just as valuable, right? I just need enough people to join in on mining that it's difficult to commit fraud, and now my secondary coin should be just as good as Bitcoin at storing value, because it's using the same technology, the same distributed governance model, and the same electricity to power it.
Heck, I don't even need to create a new coin, I can fork the current chain; that's what Bitcoin Cash did. So let's say I fork Bitcoin's chain, and all of the exchanges that currently take Bitcoin also start taking my new coin so it's similarly decentralized.
Have I just doubled the amount of electricity in the world? No, of course not. Because the value of both coins will be based on social consensus, not because they are a perfect digitized storage medium for electricity.
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Another thought experiment on retrieval.
Let's say tomorrow, the apocalypse hits. The US government collapses, the dollar is worthless, all governments are overthrown. Government-issued currency is only fit to burn. Gold isn't even worth its weight in food. Only Bitcoin remains.
Now, bear in mind that the Internet does not exist anymore, because the US government and a bunch of centralized, US-dollar funded corporations were maintaining it, and they're all gone. But you would like to convert your Bitcoin back into electricity, because it's a lossless store of electricity/effort.
How do you do that? How do you even trade your bitcoin when there is no network for you to connect to? A truly lossless store of electricity should be able to handle that situation, right?
Whenever I read something this far off the mark, I genuinely wonder if it's total lack of intellectual honesty, or, having drank so much kool aid that this argument genuinely makes sense. Bitcoin transactions require the solution of a completely useless and expensive to compute mathematical computation. THIS IS BY DESIGN, TO MAKE IT SCARCE. In the short term, we are facing a critical shortage of computer chips becaus…
Whenever I read something this far off the mark, I genuinely wonder if it's total lack of intellectual honesty, or, having drank so much kool aid that this argument genuinely makes sense. Bitcoin transactions require the solution of a completely useless and expensive to compute mathematical computation. THIS IS BY DESIGN, TO MAKE IT SCARCE. In the short term, we are facing a critical shortage of computer chips becaus…
Very disingenuous to include NFTs in the same category as Bitcoin. NFTs live on Ethereum which is in the process of changing its consensus from Proof of Work to Proof of Stake.
b) if you choose today to put yours on ETH instead of a chain that is today not PoW, you don't get to play the "but soon(TM)" card IMHO
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Sure. That's also great if you can monetize trained ML models so easily that everyone can participate. It's already being done to some very small degree by few companies that locate their ML server farms in places where energy is cheap and renewable. I hope this application will some day compete with crypto for computing power and energy and win but I don't think it will be popularized and commoditized soon enough to…
,,If you could create crypto based on ML training it would be so cool.'' That would actually be a bad thing: the real value in proof of work is that it doesn't have any extra value to the miner, which stops miners from gaining a huge edge over other possible future miners. What's behind all the controversy is that proof of work has to be totally useless work, that's what makes it valuable for the blockchain :)