[arcticbull]

Nic Carter's point is intentionally obtuse and belies his conflicted interests.

The reality is that if you scaled up the bitcoin system linearly so it provided as much transaction capacity as Visa (let alone the entire world economy) [edit or rather worded differently if each Visa transaction consumed as much power as a Bitcoin transaction], it would require a number of times more power than the entire world produces, and produce as much e-waste as the entire world put together. Obviously this is not how bitcoin scales because even if you did that it would still process 7 tps.

That is, however, proof that it is drastically less efficient on a per transaction basis even factoring in any and all possible externalities including the army and mining and the fed (lol). This is a proof by contradiction.

Anything else is a talking point and also trivially falsifiable. The US Army protects the US not the dollar and its budget would not be reduced in a Bitcoin powered world. Neither would its oil consumption because tanks don't fill up on bitcoins.

The ubiquity of the dollar specifically is also irrelevant as we're not comparing crypto to US Dollars but rather to well-managed fiat systems. Any and all. Not just one albeit dominant one.

This is obvious stuff if you think about it for a half second without trying to justify the unjustifiable.

[Geee]

That's not how Bitcoin scales. The amount of transactions doesn't matter. Bitcoin can have a limited number of on-chain settlement transactions and unlimited number of off-chain payment transactions (Lightning, Paypal, Visa, etc.) and it doesn't consume a single bit of more energy. Energy consumption is proportional to its value and the current block reward.

[arcticbull]

That's not what I am arguing as it's not what Nic is arguing.

Nic doesn't say that Bitcoin consumes less power than you think on a per-transaction basis. He says that Visa consumes way, way more if you price in nebulous externalities.

I am rejecting his thesis by saying that if Visa used as much power per transaction as Bitcoin we'd need to generate 3X as much power as we currently do.

The quote is: "Any energy comparison must take the above into account – including the externalities from the extraction of oil, which implicitly backs the dollar."

I'm taking it into account. And I'm saying he's wrong.

[shawnz]

> Nic doesn't say that Bitcoin consumes less power than you think on a per-transaction basis.

Sure he does:

> Second, metrics like the “per-transaction energy cost” are misleading because transactions themselves do not cost energy; nor does bitcoin’s CO2 footprint scale with transactional count.

The point is that transactions per second isn't the unit of value by which Bitcoin is priced. Bitcoin is not competing with other monetary systems simply on the basis of transactions per second, but also network trustworthiness/security

[arcticbull]

You stopped reading half way through my sentence. He’s not disputing Bitcoin energy usage he’s disputing visa. That’s what I wrote.

[shawnz]

I did read it but I cut out the irrelevant part.

He's not disputing the per-transaction cost of Bitcoin OR Visa, and is explicitly pointing out how looking at it on a per-transaction basis is misleading.

He is disputing the overall total network costs, not considered on a per-transaction basis but in terms of the total value provided by the network to all its users.

Transactions per second is just one of the factors that could add value to a monetary system, but it isn't the only one.

[arcticbull]

I think you’re being intentionally disingenuous like Nic, but at least he was clear: “ Any energy comparison must take the above into account – including the externalities from the extraction of oil, which implicitly backs the dollar.”

I factored it in with my calculus and you and nic are wrong. If you believe otherwise please show your work like I did not gut feelings.

TPS is a means to an end re disproving the thesis not a talking point about utility.

I am not looking at value in terms of TPS. TPS an intermediate step in my calculation. I am looking at total system usage. Sorry bud, your system is the digital equivalent of rolling coal and no amount of mental gymnastics will change that.

But by all means show your work and let’s talk about it, don’t just say “nope try again” haha that’s what people who have no leg to stand on do.

[Geee]

Per-transaction basis is completely meaningless math. Both systems can be scaled as I said. The point is that it's more expensive to run the US dollar system than Bitcoin.

[panarky]

Per-transaction is only meaningful if you believe Bitcoin's only utility is by competing with Visa for everyday transactions like buying a cup of coffee.

But if you find that Bitcoin is a digital, permissionless, borderless, uncensorable store of value, a better gold than gold, then it doesn't need millions of transactions per second.

Bitcoin is just fine as the most secure settlement layer and long-term store of value for large, infrequent and expensive transactions.

Fiat money isn't going anywhere, Visa doesn't need to be replaced, and Bitcoin doesn't need to pay for your coffee to be useful. It can do what it does best, coexisting with fiat systems and other cryptocurrencies.

[arcticbull]

> Bitcoin is just fine as the most secure settlement layer and long-term store of value for large, infrequent and expensive transactions.

It's not, because its inability to scale means folks are pushed onto L2 which has none of the guarantees you mention.

[panarky]

If I buy real estate or fine art to defend against the money printer, my transactions are large, infrequent, slow and expensive.

As Bitcoin's use as a store of value increases and transaction throughput remains constant, transactions will be larger, less frequent and more expensive.

I won't get pushed out onto L2 just like I'm not pushed to liquidate real estate or art collections. I don't transact in long-term stores of value more than once every few years, and then I expect the transaction will be large, slow and expensive.

[shawnz]

Users can choose to adopt the trade-offs of second layer solutions if and when it is convenient for them, and with whatever portion of their wealth that they like.

[Geee]

These guarantees aren't needed for most daily transactions. Using Visa with Bitcoin is fine, and does not undermine the security of the currency.

[ashtonkem]

Per-transactions costs matter a lot, you can’t just hand wave that away if you’re hoping to actually persuade anyone.

As far as scaling Bitcoin goes: prove it. It’s been a decade and it still does 4tps.

[uh-quan]

>As far as scaling Bitcoin goes: prove it. It’s been a decade and it still does 4tps.

Sure. The Lightning Network already exists, is working and in use, and can in principle do essentially unlimited TPS.

Bitcoin doesn't need to scale to millions of TPS to be successful (since payments and microtransactions aren't its only use case), but it so happens that it can do that through second layer technologies.

[Geee]

https://www.binance.com/en/cards

[ashtonkem]

Pointing to a Visa card to solve crypto scaling is probably not the argument I’d go for.

[arcticbull]

Well ok do you have any basis for that or is that speculation?

[Permit]

How many transactions/day is Lightning handling? I recall this same discussion in late 2017. Have they managed to successfully get people using it yet?

[anonisko]

You can't directly measure the number of transactions happening on lightning network unless every non leaf node publishes it's numbers, and even then you'd have to trust they're telling you the truth.

And it's even more complicated than that, because you'd have to take the data from every node, and reconstruct complete paths to identify a single transaction.

And yes, I personally use the Strike app + Fold app to collect satoshi rewards by buying gift cards for shopping. Strike also has a beta app that uses lightning as the rails for global p2p transfers, e.g. you can instantly send USD to EUR. https://twitter.com/JackMallers/status/1346867753253220356

[helen___keller]

> Have they managed to successfully get people using it yet?

I was trying to figure out the same thing a month back[0], but most of the responses I got boiled down to "you're asking the wrong question". It's hard to wade through the crowd of "it's just digital gold", but the best response I got[1] is that it works decently for places that accept it, but there are hiccups, usually around liquidity.

[0] https://news.ycombinator.com/item?id=25675472

[1] https://news.ycombinator.com/item?id=25676779

[arcticbull]

Roughly zero, and no. [1]

[1] https://bitcoinvisuals.com/lightning

[3np]

There is no number there on the number of transactions, simply because it’s impossible to measure. It’s only possible to see the lightning transactions flowing through your own node.

Each channel accommodates theoretically infinite amount of transaction.

[ashtonkem]

More knowable question: who actually uses the lightning network to accept payment for goods and services?

[anonisko]

https://foldapp.com/

https://store.blockstream.com/

https://acceptlightning.com/list.html

Several major exchanges have announced that they are implementing LN support. Still very early days.

[arcticbull]

Good point, thank you for the correction.

[miracle2k]

> The reality is that if you scaled up the bitcoin system linearly so it provided as much transaction capacity as Visa (let alone the entire world economy), it would require a number of times more power than the entire world produces, and produce as much e-waste as the entire world put together.

It's fair to judge Bitcoin's energy use by its tps, but the above is not true. Energy use and tps are, as you then acknowledge, not related. It is possible to increase the number of tps by many multiples. The trade-off is centralization due to hardware requirements.

[ashtonkem]

Unfortunately for Bitcoin, it needs more than “many multiples” in order to actually handle function as a currency. At 4tps they’re several orders of magnitude short of what the market actually needs.

[uh-quan]

That's why second-layer technologies like the Lightning Network are being built.

Bitcoin doesn't have to function as a currency to be wildly successful (since being a currency isn't the only relevant use case), but with second layer networks it will be able to.

[arcticbull]

Once they increase it, which they won’t for philosophical reasons, I’ll update my assessment. Until then it’s strictly fair and accurate.

It’s representative of the world in which we live today not some hypothetical world that could exist in the future - that the team has promised and failed to deliver for a decade. I can make up numbers for visa that match too.

After all climate change doesn’t care about hypotheticals.

[miracle2k]

They will not increase it. I am merely pointing out the idea "to do twice the number of transactions it would consume twice as much energy" is not correct, because raising the block size would not necessarily increase energy consumption.

[arcticbull]

That’s not the point I’m making. The point I’m making is it takes more energy per transaction even after factoring in all specified and unspecified externalities because it’s not thermodynamically possible for visa to use as much energy per transaction. Visa would have to consume roughly 3X the entire worlds power output to match the sheer waste of Bitcoin.

[ClumsyPilot]

"Until then it’s strictly fair and accurate."

Your argument is about as convincing as "well you couldn't make a payment billion dollars because a penny weighs 1 gram, and their combined weight would be too heavy to transport"

[arcticbull]

How so? I said on a per transaction basis by falsification it’s not possible, factoring in all externalities for a Bitcoin transaction to be more efficient than visa. It is not. End of story. The scaling is a thought experiment not a plan.

Your counter example is nonsense.

Could it be in the future more efficient given unspecified future changes? Who knows but it sure as shit isn’t today. I was pushing back on Nic’s theory on pricing in externalities.

[r3ctilinear]

"Future changes"? "Who knows"?

The more efficient changes ALREADY HAPPENED years ago in the form of Lightning network.

The Bitcoin blockchain is the bedrock of this new peoples currency and upon it has been built the Lightning network which is a Bitcoin integrated sidechain for cheap and small transactions.

Lightning facilitates Bitcoin transaction capacity to scale in a ludicrously efficient manner and has now been technically maturing for years now. Please keep up.

[arcticbull]

The number of lightning transactions and channels rounds to zero, so in a way, I did include them. Same number of channels, about half the capacity per channel, same quantity of locked up value (about 1000BTC total) and the same number of users since 2019. [1]

Of course it's not a solution to scaling, because it requires one on-chain transaction to open, one to close, and if an intermediate node happens to go down your funds are locked. It's garbage. Vastly overcomplicated garbage.

By the way to just open a single channel for everyone on earth today and close it will take about 70 years, so right around the year 3000 if you (very optimistically) factor in births and deaths. And about $265 billion dollars at current fee rates - $18.99 as quoted today. Elon better pony up! This of course assumes the blockchain isn't used for anything else in the interim.

How small can the transactions be if a channel open/close costs almost $40?

The only L2 solutions that scale are permissioned, centralized and/or trustful. Because that's how you scale. And you can back those with anything as none of the guarantees of the underlying asset are conferred to these L2 networks simply because they notionally operate on top of Bitcoin for net settlement and the (soon to be unlawful) non-custodial wallet.

[1] https://bitcoinvisuals.com/lightning

[shawnz]

> ... climate change doesn’t care about hypotheticals.

But increasing the block size limit wouldn't reduce the energy consumption. It would just make Bitcoin support a higher maximum transaction count per second, which perhaps the market doesn't even need or care about.

[arcticbull]

I would love to see you defended active tire fire in your backyard with the same logic.

[shawnz]

Can you explain what you mean?

The power consumption of Bitcoin is proportional to the price of Bitcoin, it is not related to the demand for making transactions or how many transactions are being made.

[arcticbull]

You folks keep saying that like it’s a good thing but in my opinion that is a scathing indictment of the system. You’re talking about something that’s intentionally anti-efficient. It’s the only technology I’ve ever seen in my entire lifetime but becomes less efficient when more people try and use it. It’s horrifying.

[edit; to your reply: that sounds like a bad solution and I think you know that lol]

[ClumsyPilot]

"if you scaled up the bitcoin system linearly so it provided as much transaction capacity as Visa ... it would require a number of times more power than the entire world produces"

This is a complete fantasy - power consumption is driven by the desire to secure the network, it is not related to transaction volume.

There is an argument that power consumption would have to be significant because attacking the network has to be cost- prohibitive, and there are people working on POS and similar approaches.

Etherium is actually attempting to scale, their talks are very interesting .

[null0pointer]

How can you say "if you scaled up the bitcoin system" and "this is not how bitcoin scales" in the same argument?

Bitcoin could handle arbitrary scaling with little power-usage increase had it not been intentionally hamstrung by (for lack of a better term) "small-blockers". This is because the primary power usage of bitcoin (mining) does not scale linearly with transactions/block. The transactions to include are usually considered once by the miners who then make iterated attempts at solving by modifying the block nonce, not the included transactions.

[arcticbull]

When that changes I’ll update my math. Until then it doesn’t matter. Its less efficient on a per transaction basis by falsification. It is fundamentally thermodynamically impossible for it to be more efficient today on a per transaction basis. It’s been 14 years. Time to look in the mirror and stop making excuses for its devastating waste.

The case I am making is that it is not possible for Visa to use as much power as Bitcoin on a per transaction basis based on today's energy usage, factoring in all exernalities - because the world would be out of power.

I am simply countering Nic's trivially incorrect position.

[shadowfiend]

You countered the position, but you did not spend time understanding it.

As an example, ACH is an FTP based system that largely runs once a day (maybe 2-3x now), fed by various backing mechanics for the bank itself, including the Fed and whatever else you’d want to suck in.

Visa’s transaction rate is completely orthogonal to that system. Visa could 10x their transaction rate without touching that underlying system if they wanted to, as could something attached to Bitcoin. So your argument about scaling Bitcoin up counters a poor understanding of the initial position—so poor as to make it a different position entirely.

[arcticbull]

It's not worth understanding because the goalpoast shifts every 5 minutes. Bitcoin is like a religion. Every point you tear down they come back and say ah but wait! The princess is in another castle!

Because there's nothing there.

The whole thesis of Bitcoin is that it's trustless, decentralized and permissionless. It's also obvious that it doesn't scale beyond a single Costco or a mid-sized flea market. The only way to scale it is "Layer 2" networks which fundamentally are trustful, centralized and/or permissioned. Because that's the only way to scale. You can back those L2 networks with anything. Gold. Shoes. Dollars. GME shares if you ask Bittrex in any non-US market. There aren't even any guarantees these un-audited, un-accountable, un-regulated exchanges aren't selling more bitcoins than exist the way you oversell seats on a plane. Should be fine unless there's a run.

If all you want is a one-way message for net settlement between banks, I recommend you investigate SWIFT and ACATS.

The system doesn't do what it says on the sticker. The only reason anyone cares is number go up. And number only goes up if you go through the kind of crazy mental gymnastics Nic did.

[edit: ACH is dead, long live RTP [1], and guess what, RTP doesn't use one Argentina of electricity either somehow]

[edit: My argument isn't about scaling, it's about Wh per transaction, which Nic is strictly, totally and completely wrong about; let's stay on topic]

[1] https://www.theclearinghouse.org/payment-systems/rtp

[PycptN2MH]

> The reality is that if you scaled up the bitcoin system linearly so it provided as much transaction capacity as Visa... it would require a number of times more power than the entire world produces

Scaling Bitcoin's tps does not increase its energy usage. The tps and energy usage vary independently of each other. Bitcoin does not require any more energy usage to handle more tps than Visa. In fact, if we include off-chain transactions which are settled on-chain it already can.

> The US Army protects the US not the dollar

What is the value of the dollar if the United States ceases to remain a sovereign polity? The dollar is part of the United States.

[colordrops]

How do completely incorrect comments like this get upvoted?

[arcticbull]

Well that might be because they’re correct my dude! Feel free to weigh in with your analysis. Nobody’s been able to spot a hole in the logic.

[colordrops]

No, anyone who understands the Bitcoin protocol knows that energy doesn't scale with transactions. Read the paper. You could have your laptop sign a million transactions and it would be secure.

Energy scales with competition to sign transactions. Read the Bitcoin white paper my dude.

[arcticbull]

I did, and frankly, it shows a shocking lack of understanding of economics. Which is why we find ourselves in this situation.

It's no different than you saying "read the bible!"

[colordrops]

It's completely different than the bible because it can be proven by yourself, no faith needed. There is the whitepaper and there is source code. But since you are so cynical as to not believe people, and didn't seem to understand the whitepaper, I'll explain it to you:

Transaction blocks are generated at a fixed rate, no matter how many miners are operating. This is done by adjusting the difficulty of finding a sha256 hash on the data of the transaction block. You simply need to find a hash by adding some random data to the block until you find a hash that ends in 0. The more 0s at the end of the hash, the harder to find.

Generating a sha256 hash is easily done by a laptop computer. But when huge farms of ASICs are finding the hash very quickly, the difficulty goes up to throttle the transaction rate, and many more hashes must be calculated in order to find one that meets the criteria. This is where the energy use comes from - the hash difficulty, not the number of transactions in a block - thus it scales with competition to sign blocks, rather than the number of transactions.

[ajhurliman]

This may arise from a misunderstanding of how Bitcoin works, but TPS have nothing to do with energy consumption.

[tedivm]

That alone should say something.

[arcticbull]

Yeah that say that like it’s a good thing but all I’m reading is a scathing indictment.