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China wants an orderly exit from Bitcoin mining

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Re: China wants an orderly exit from Bitcoin mining

#71

Post by paulmd »

ThatPlayer wrote: post #69
littlestymaar wrote: post #52

Earlier quoted context omitted.

> Miners find a block and distribute them to the P2P Bitcoin network. Blocks do not carry IP addresses You just need to become part of the p2p network by yourself, and log the IP of people you communicate with …

Miners also do not need to be part of the p2p network. A mining pool for example will distribute the block for you and send you the bitcoins. There's also a tool to send transactions [1] so you do not even have to be part of the network to send/receive transactions. [1] https://insight.bitpay.com/tx/send - These still require your signing key, so you can use Bitcoin without ever being on the network. It just requires…

Any way you want to slice this, there is data travelling, and China has the deep packet inspection and machine learning technology to identify what type of connection it is even if it's encrypted or tunneled.

The average lifespan of an unauthorized VPN connection transiting the Great Firewall is a few minutes or less, depending on how much data you try to push across it. It's really not hard to fingerprint a connection just based on traffic analysis, even if you can't see the actual data travelling across it.

If China wants it shut down, it'll be shut down, full stop.

Re: China wants an orderly exit from Bitcoin mining

#72

Post by tanilama »

abrkn wrote: post #67

This is a good time to invest in electricity and facilities in Mongolia > Mongolia hosts 10% of the world's known coal reserves at an estimated 162 billion tonnes in 2011 with 17 operating coal mines

Fun fact: Mongolia buys electricity from China

Re: China wants an orderly exit from Bitcoin mining

#73

Post by vec »

baddox wrote: post #57
vec wrote: post #48

Earlier quoted context omitted.

Person A mines 1 BTC. Since a Bitcoin has no intrinsic value (as distinguished from market value), Person A has not created any value. They have created $0 worth of goods. Person A sells their coin to Person B for $1,000. A is $1,000 richer and B is $1,000 poorer. B sells the bitcoin to C for $2,000. A is still $1k richer, B is $1k richer, and C is $2k in the hole. C sells to D for $3k. A, B, and C are all $1k richer…

The proof of work needs to be “useless” in order for it to protect the blockchain (there are proposals that dispute this, and I won’t claim to be an expert, but that’s the fundamental idea behind Bitcoin). When you say that the net value is negative even if the network itself has some positive benefit, what is the negative component there? The only negative component of all that electricity usage is externalities, wh…

Electricity isn't free. In the US it's about $0.12/kWh. If I spend a kWh of electricity mining Bitcoin, I owe the electric company in my town another $0.12. Presumably the electric company uses most of that $0.12 on the fuel and maintenance costs necessary to generate and provide me a kWh, costs which they would not have incurred but for my choice to mine Bitcoin.

Incidentally, this is (as far as I understand) where most of the transaction fees ultimately end up. They're paid out to the miner who actually commits a transaction. Mining's a relatively competitive field so people aren't going to be able to charge much of a premium. The miners then have to turn around and use those fees to cover their costs, which in practice means their hardware costs and their electrical bills.

Re: China wants an orderly exit from Bitcoin mining

#74

Post by dullgiulio »

miscreanity wrote: post #66
astrodust wrote: post #43

Earlier quoted context omitted.

Facebook buys servers to meet their needs, not to grind away on useless "proof of work" systems. They're also interested in aggressively optimizing how that capacity is used, and where possible work to reduce power consumption, compute requirements, and other such things. They can alter how their software interfaces with their systems, how many requests it makes, what kind of data they return and how often. Facebook…

What's the point of security staff at a bank or military installation? If things are slow, just send guards home. We'd be able to save millions.

You might be aware that, outside of the world of cryptocurrencies, people have been exchanging money and other assets totally fine without proof-of-work since we stopped living on trees.

Re: China wants an orderly exit from Bitcoin mining

#75

Post by jrsks »

tanilama wrote: post #72
abrkn wrote: post #67

This is a good time to invest in electricity and facilities in Mongolia > Mongolia hosts 10% of the world's known coal reserves at an estimated 162 billion tonnes in 2011 with 17 operating coal mines

Fun fact: Mongolia buys electricity from China

Mongolia is also investing in renewable energy. For example the solar park in Darkhan and the Salkhit wind farm, but of course these are not closely enough to cover Mongolia's need yet. In the meanwhile the population of Ulaanbaatar has to breathe some of the most toxic air in the world.

However, Mongolia seems to be one of the few countries, where Bitcoin mining seems to make sense, because of cheap energy and it's complicated economic situation that makes producing and exporting goods very hard. With Bitcoin they don't have to ask China or Russia for permission to cross the borders.

Re: China wants an orderly exit from Bitcoin mining

#76

Post by tromp »

mehrdadn wrote: post #33
bamboozled wrote: post #32

Earlier quoted context omitted.

I don't get winging about mining crypto currency and "wasting power", it's not really a waste, it's proof of work. Besides, we humans waste energy on way worse things than mining Bitcoin. What about running Facebook, the tens of thousands of high end servers running globally just to figure out what useless junk to feed people, in a way that is detrimental to their health. I don't hear many people complaining about th…

> it's not really a waste, it's proof of work Every kind of waste I can think of is a proof of some kind of work. That doesn't make it a good thing.

No; most kinds of waste are not instantly verifiable, but proof of work is.

Re: China wants an orderly exit from Bitcoin mining

#77

Post by MagnumOpus »

abrkn wrote: post #67

This is a good time to invest in electricity and facilities in Mongolia > Mongolia hosts 10% of the world's known coal reserves at an estimated 162 billion tonnes in 2011 with 17 operating coal mines

Is coal electricity competitive for mining coins? I thought you need to be next to a hydro plant?

Re: China wants an orderly exit from Bitcoin mining

#78

Post by koonsolo »

TazeTSchnitzel wrote: post #2

I am personally of the opinion that China swiftly killing off its cryptocurrency mining industry overnight would be to the great benefit of humanity. The sheer amount of electricity it wastes is an environmental disaster.

I am personally of the opinion that cryptocurrency swiftly killing off the (central) banking industry would be to the great benefit of humanity. The sheer amount of electricity, human energy, infrastructure, material and real estate it wastes is an environmental disaster.

Re: China wants an orderly exit from Bitcoin mining

#79

Post by Synaesthesia »

baddox wrote: post #54
Synaesthesia wrote: post #46

Earlier quoted context omitted.

Of course it’s a zero sum game, I’d like to hear how it’s not. It’s not creating any value, any gains are at the expense of someone else.

Who are they at the expensive of?

The people buying the coins when you sell it. It would be impossible for everyone to profit from bitcoin. There would always have to be losers.

Re: China wants an orderly exit from Bitcoin mining

#80

Post by bamboozled »

astrodust wrote: post #43
bamboozled wrote: post #32

Earlier quoted context omitted.

I don't get winging about mining crypto currency and "wasting power", it's not really a waste, it's proof of work. Besides, we humans waste energy on way worse things than mining Bitcoin. What about running Facebook, the tens of thousands of high end servers running globally just to figure out what useless junk to feed people, in a way that is detrimental to their health. I don't hear many people complaining about th…

Facebook buys servers to meet their needs, not to grind away on useless "proof of work" systems. They're also interested in aggressively optimizing how that capacity is used, and where possible work to reduce power consumption, compute requirements, and other such things. They can alter how their software interfaces with their systems, how many requests it makes, what kind of data they return and how often. Facebook…

I believe if you're a serious miner, then you're just as interested in building the most energy efficient system possible [1], that way you will receive the greatest return on your investments. Just like FB, Amazon, Google etc. I would also say the majority of miners buy their own servers, so I don't get your point on that front.

> You must run your systems flat out, all the time, no breaks. Apart from more efficient mining hardware, there's no way to optimize how it mines, it's 100% utilization all the time.

Do you have the same problem with other projects such as SETI@Home and Folding@Home? How about serious gamers or people who watch a really big screen TV all night while on their phone hardly watching it?

I also think that you're making assumptions about these large tech companies by thinking they really do care about energy efficiency as an absolute top priority. While I'm sure it's a consideration, it doesn't mean it always gets the front seat. Remember these companies had time to make this a focus just like new coins are making energy efficiency a priority [2].

Crypto currencies are a new technology and need time to evolve,they will become more efficient in the near future.

[1] http://www.ibtimes.co.uk/geothermal-gold-why-bitcoin-mines-a...

[2] https://www.prnewswire.com/news-releases/bitcoin-alternative...

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