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Bitcoin mining and energy consumption

blog.bitcoin.org.hk

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Re: Bitcoin mining and energy consumption

#91

Post by asdgkknio »

seanwilson wrote: post #22

One of the big selling points of Bitcoin is that it's meant to be decentralised but it doesn't look like this plays out. Proof of work seems to inevitably lead to all the power going to parties that can afford specialised hardware who are in countries with low electricity costs. Running a Bitcoin miner on commodity hardware now is pointless which seems to go against the spirit of Bitcoin when it started. Was this pre…

>Coming up with a way to have a decentralised currency where everyone involved gets a fair say without consuming too many resources is a super interesting problem.

I think the obvious solution is to do useful work rather than throwing away work on crypto. Have miners solve real problems and give them credit for getting the right answer.

This is what Ethereum is supposed to do. I don't think it's a great solution. It's still extremely wasteful since every node runs every computation. Even something like TrueBit, which is designed to be scalable and efficient, is still far less efficient than normal cloud architectures. It still throws away the vast majority of the work in the interest of safety and incentives. These systems are good if you want trustworthy computation, but not if you want high-performance and power-efficient computation.

I'm trying to design a system where something like 95% of the work goes to useful computation, but I have nothing anywhere near shippable. It's a hard problem.

Re: Bitcoin mining and energy consumption

#92

Post by DSMan195276 »

scrumper wrote: post #75
QAPereo wrote: post #58

Earlier quoted context omitted.

Is it a waste to burn CPU cycles, to have a chunk of entropy to wave around so that you can possibly buy shit? Yes.

It's not so different to burning diesel to dig up rocks so you have a chunk of metal to wave around. Which isn't, you'll notice, necessarily a counter argument to yours.

I would actually argue it is very fundamentally different. Once you've dug up your chucks of metal, trading them with others requires very little extra energy to be expended (Especially if we're going to go all the way to talking about actual cash, which is easy to split-up into smaller denominations).

Vs. Bitcoin, which will still require miners to expend the same amount of CPU cycles to keep the network working so you can transfer your Bitcoins to others, even after all of the Bitcoins are mined and the blocks provide no new Bitcoins into the market.

Re: Bitcoin mining and energy consumption

#93

Post by dmihal »

QAPereo wrote: post #58
albertgoeswoof wrote: post #23

Bitcoin's electricity consumption is unfortunate, it's difficult to assess whether it is a waste or not. The current position blockchain tech can be compared to the state of networked computers in the 70s and early 80s. Not a huge amount of value delivered at the time, yet very few could have foreseen the impact of the internet and personal computing on the world. If blockchains and distributed computing does present…

Is it a waste to burn CPU cycles, to have a chunk of entropy to wave around so that you can possibly buy shit? Yes.

Is it a waste to have a webserver running all day, sitting idle for most of the day?

Re: Bitcoin mining and energy consumption

#94

Post by sniem »

seanwilson wrote: post #22

One of the big selling points of Bitcoin is that it's meant to be decentralised but it doesn't look like this plays out. Proof of work seems to inevitably lead to all the power going to parties that can afford specialised hardware who are in countries with low electricity costs. Running a Bitcoin miner on commodity hardware now is pointless which seems to go against the spirit of Bitcoin when it started. Was this pre…

>lead to all the power going to parties that can afford specialised hardware who are in countries with low electricity costs.

Is it costly just because it was newly created though, and won't this cost come down? You can also mine in countries with high electricity if you build your own renewable energy generator.

In terms of decentralisation, the nodes are still decentralised and can at least detect when miners try to use their dominance. They can only do it after the fact, and it might be messy, but it makes performing the attack fairly worthless as you can no longer mine on the network anymore.

Re: Bitcoin mining and energy consumption

#95

Post by saalweachter »

QAPereo wrote: post #85
mazlix wrote: post #73

Earlier quoted context omitted.

How are you able to definitively say that's more of a waste than to gather cotton and linen and then print money?

False dichotomy... electronic transactions and bitcoin are hardly synonymous.

Eh, I'd call it more of a "tu quoque" (appeal to hypocrisy).

Re: Bitcoin mining and energy consumption

#96

Post by [deleted] »

jasode wrote: post #43
seanwilson wrote: post #22

One of the big selling points of Bitcoin is that it's meant to be decentralised but it doesn't look like this plays out. Proof of work seems to inevitably lead to all the power going to parties that can afford specialised hardware who are in countries with low electricity costs. Running a Bitcoin miner on commodity hardware now is pointless which seems to go against the spirit of Bitcoin when it started. Was this pre…

>Was this predicted at the inception of Bitcoin? It was not predicted in the original Bitcoin whitepaper. Yes, it discussed the theoretical feasibility of a 50+% attack to double-spend but it didn't explicitly predict a "consolidation" to specialized hardware miners that leaves out the miners at home using regular computers. >It's interesting how economics impacts the security of the protocol like this. Every decentr…

[deleted]

Re: Bitcoin mining and energy consumption

#97

Post by gtrubetskoy »

6d6b73 wrote: post #52
gtrubetskoy wrote: post #40

Earlier quoted context omitted.

But you do need banks to store cash. And the bank better have a secure vault and security guards and cameras and all that. An elliptic curve key, which is what possession of bitcoin is, is just a large number. To send a bitcoin you need to create a "transaction", and in fact the only aspect of generating a bitcoin transaction that requires energy is the SHA calculation, not something you can do in pencil, the EC math…

I have cash in my pocket. I'm not a bank. Therefore you don't need bank to store cash. Simple? And I use cash on a daily basis.. We're far from being the cashless society you claim we are.

But you can only have so much cash in your pocket. The bitcoin private key is 32 bytes always, regardless of the amount.

For example here is the famous 37 BTC ($500,000+) donation to Andreas Antonopoulos yesterday, this couldn't be done with cash, at least not as seamlessly, inexpensively and quickly:

https://blockchain.info/tx/e68ebe16e6aaa08e3f9d271ba78aaeb4c...

Re: Bitcoin mining and energy consumption

#98

Post by hutzlibu »

nathan_f77 wrote: post #68
moneytide1 wrote: post #5

The electricity consumption is a red flag, but perhaps it could be cheaper than the cost to build and maintain Guarda/Loomis trucks that carry physical currency, energy to melt metal to mint coins, and all the costs of building brick&mortar banks (even then, bankers provide auxiliary services like loans and advisement). We are all spending time talking about it as a collective effort to determine whether or not it sh…

> I am wary of the entire thing because we are starting to spend more time talking about money. Or making money on money. You can also have positive discussions about money, for example: inequality, altruism, basic income. I've been thinking about a hypothetical "altruistic" cryptocurrency that could have some rules to combat inequality. It might even be possible to provide a basic income to everyone based on a web o…

"I just realized that taxes are actually a form of forced altruism. The money goes towards good things"

Like war (on drugs, iraq, afghanistan), NSA, CIA, etc? And you have also not much choice, if you don't support the spending on the current education system for example.

Thats why it is not a donation. So in my Utopian future taxes would be indeed voluntarily and directly bound - so if there is no money for certain things, then apparently nobody wants them. I suppose most people favor education and streets over sustaining a global invading force, but I might be wrong. Anyway, still a long way to go for this ...

Re: Bitcoin mining and energy consumption

#99

Post by hutzlibu »

matt4077 wrote: post #27
moneytide1 wrote: post #5

The electricity consumption is a red flag, but perhaps it could be cheaper than the cost to build and maintain Guarda/Loomis trucks that carry physical currency, energy to melt metal to mint coins, and all the costs of building brick&mortar banks (even then, bankers provide auxiliary services like loans and advisement). We are all spending time talking about it as a collective effort to determine whether or not it sh…

Every transaction consumes an average household's WEEKLY engird usages. How's that not a simple concept? > Buy, sit on it, cash out back to federal reserve notes. Profit. If someone wins, someone else has to lose. And no, it's not the credit card companies. It's the last one holding the potato.

"If someone wins, someone else has to lose"

You (and many others) might need to look up the concept of "mutual benefit"

Re: Bitcoin mining and energy consumption

#100

Post by spookthesunset »

moneytide1 wrote: post #5

The electricity consumption is a red flag, but perhaps it could be cheaper than the cost to build and maintain Guarda/Loomis trucks that carry physical currency, energy to melt metal to mint coins, and all the costs of building brick&mortar banks (even then, bankers provide auxiliary services like loans and advisement). We are all spending time talking about it as a collective effort to determine whether or not it sh…

> but perhaps it could be cheaper than the cost to build and maintain Guarda/Loomis trucks that carry physical currency, energy to melt metal to mint coins, and all the costs of building brick&mortar banks

On a per-transaction basis? I don't even need to work out the math to tell me it isn't even close. Bitcoin can at most handle 4 transactions per second. By virtue of its very design it will never get much more than that. Our existing financial institutions process tens or even hundreds of thousands of transactions every second. Even if the entire worldwide financial industry consumed as much power as bitcoin, on a per-transaction basis (or even a per-dollar/euro/yen basis) our existing system is much, much, much, much, much more efficient.

Just to again emphasise, Bitcoin (and hence the blockchain) by design cannot scale much more than it already has. It is simply impossible without giving up all of Bitcoin's attributes that people consider important (decentralization, trustless trust, etc...)

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