[FollowSteph3]

We’re cobstantly dealing with environmental issues and global warming yet burn incredible amounts of energy and carbon compared to the value this gives us. It would probably be more environmentally friendly to not use crypto currencies then to stop using all the electricity you do each day...

[wmf]

incredible amounts of energy compared to the value this gives us

Note that the value of ETH is higher than the value of the energy needed to mine it; that's why people mine. So is your complaint really about mispricing of energy (externalities) or about other people having different values than you?

[wpietri]

Well, the price of ETH is higher than the price of the energy needed to mine it. The energy consumed has demonstrable value, but that's yet not true for ETH. As many people have said here, it's experimental. And of course, there's a fair bit of financial speculation going on. But as far as I know, it's generating no significant value on its own.

[tudorconstantin]

What does it even mean "demonstrable value"?

If a person is willing to spend money (for energy, or for buying crypto on an exchange), we can say crypto has "demonstrable value" for that person, no matter what they want to do with that crypto.

[wpietri]

By your theory, every Ponzi scheme and pigeon drop has demonstrable value.

I agree that spending money and receiving value are correlated. I just don't think they're identical.

[softawre]

Does it have value to society? That is the question. Of course it has value to people if they are willing to pay for it.

[wpietri]

I think something only has value to people if they purchase it repeatedly and end up satisfied with the outcome over the relevant time scale. People pay for speeding tickets, but nobody's very excited about them. You can ask many ex-smokers (and any emphysema patient) about the value of cigarettes. And as a kid I had to learn a lesson about ordering stuff advertised in comic books; I was willing to pay, but often didn't receive value.

[NickM]

"other people having different values than you" makes it sound like the value of ETH is purely a matter of personal opinion. It is, however, possible to fundamentally misprice an asset. I think OP is arguing that the ultimate real-world utility of ETH is not accurately reflected by its price.

[FollowSteph3]

It's about the price of generating the electricity in terms of the damage it does to the environment (rather than dollar amount) compared to the value the cryptocurrencies generate. Most people look just at electricity costs and not electricity costs AND environmental costs.

[dnautics]

If we're going that way how about not having an economic system that predicates social stability on growth? The very essence of how our society is structured is antithetical to environmental stewardship, forget a few people playing around on computers.

[NickM]

Growth in the economy is not necessarily predicated on growth in consumption of natural resources. Those two things tend to be correlated in modern society, but they're not inextricably linked; we don't necessarily have to give up on the idea of economic growth in order to preserve the environment.

[wpietri]

Definitely. A few years back Jesse Ausubel gave a great talk in SF on this: http://blog.longnow.org/02015/02/06/jesse-ausubel-seminar-me...

A core point was that economic growth has now decoupled from many resources. Computers are an obvious aid here; look at how much time we spend in front of one screen or another. My laptop is hugely valuable to me, but it took something like 1g of materials per hour of use to build it, and uses way less power than the lightbulb I previously would have read a book by.

[dnautics]

I'm sympathetic to the idea that technology decreases the per unit cost of productivity output, but the whole point of stimulating economic growth (via factors like inflation) doesn't work if the stimulus doesn't outpace the improvement in efficiency.

Technology is fundamentally deflationary. So if you believe that inflation (and growth) is necessary for social stability, you must incentivise consumption beyond technology's capacity to improve efficiency.

[wpietri]

I think we're talking about two different things: economic value and the price of currency. I agree that you don't want currency deflation. But over decades, I don't think that has much to do with the value to users of goods.

I can think of a few obvious places where they split. One is where we increase quality. A well-trained chef doesn't use significantly more resources than a bad cook, but the result is much better. There's also quantity; by 1980s prices, I have lost millions of dollars worth of data storage in my couch cushions. (Entertainment is a great example of both dimensions.) And it can be perfectly healthy for an economy to decrease hours worked for the same or better result, as in Germany: https://www.economist.com/graphic-detail/2018/12/28/why-do-s...

So sure, we want currency stability, and we don't want recessions. But I don't think we face a Midas Plague [1] scenario.

[1] https://archive.org/stream/galaxymagazine-1954-04/Galaxy_195...

[dnautics]

> I agree that you don't want currency deflation

https://krugman.blogs.nytimes.com/2010/02/13/the-case-for-hi...

> Yet when you have very low inflation, getting relative wages right would require that a significant number of workers take wage cuts. So having a somewhat higher inflation rate would lead to lower unemployment, not just temporarily, but on a sustained basis.

Just to be clear that we understand the policy here in blunt terms: The point of inflation is to cheat the working classes out of their income so that the ruling class can lay claim to high employment metrics. This is the price of currency stability.

[OliverJones]

Yes.

My electric grid provider buys power from Hydro Québec. I'm happy they're using a differential rate tariff for crytpo farms. Maybe it will slow the escalation in my bills, which outrun my attempts to conserve electricity.

That being said, crypto farms are an almost ideal workload for a smart grid, as long as they can shut off when other customers draw peak loads. They are a predictable base load, drawing power all the time. A grid with a smaller difference between peak design load and base load has a better return on capital.

That means a grid charging more to miners than other customers acts against its own narrow self-interest. But, grids do it anyway. My local grid pays to retrofit city street lights (another nice base load) from sodium vapor to LEDs to save power, for example.

If we (collectively) embrace crypto, we must also embrace nuclear power because it's great for base load and emits no carbon. Is that a bargain worth making?

[lykr0n]

Just goes to show how short sighted some people can be. Make money now, or give up that chance so future me or my possible future kids might have a slightly better world to live in. Now multiply that by a lot and- it's hard.

[emasirik]

To many people, the world in which they have more money is probably the "better" world to live in, even if that world as a whole is less healthy.

[bordercases]

You assume that the people that use cryptocurrencies also tend to be the people that want kids.

[lykr0n]

I mined NiceHash for a bit. Made a couple of grand doing it (I also pay for 100% wind power), but I didn't really consider the impact it would have. I saw the $10 to $15 a day for little to no work and took it.

[agumonkey]

I feel as if the digital world is half drug and that cutting off will lead to a weird period of time until we can enjoy non electronics based good times. Still it may feel weird that such modern and sophisticated tech led to more problems than bonuses.