[caf]

I don't think the criticism is exactly wrong, but it's more like Bitcoin mining is the reductio ad absurdum exposing the waste of resources that goes into gold mining (yes, there's some industrial uses, but that is a rounding error compared to the quantities that are dug up, purified, cast into bars, shipped around the world and buried back underground in vaults).

[arcticbull]

About half is used for jewelry because gold is shiny pebbles. About 10% is used for electronics.

Mining Bitcoin consumes 5X as much energy as gold, btw, per unit value extracted. It also requires mining gold to produce the circuit boards used for mining Bitcoin - given the popularity of the ENIG immersion gold plating process for PCB contacts.

The secondary issue is that of course each Bitcoin transaction generates 100g of e-waste which cannot be recycled and just gets buried. E-waste has a few grams of metals, but is mostly plastic and FR4 (epoxy filled fiberglass). Plastic and FR4 cannot be recycled. What little of the e-waste can be recycled is shipped to third-world countries where poor people dig through piles of scrap and dunk it in toxic chemicals.

The only meaningful way to move forward is to reduce consumption, especially consumption which achieves nothing, like literally wiring up a power plant to compute hashes of random data instead of attaching it to the grid to do useful things.

What a disaster.

[roenxi]

There is a really easy solution for this disaster - a trusted party could run a big relational database that was basically a non-inflating currency and really cheap to run.

Except that isn't going to work, because governments are untrustworthy and as history shows will sooner rather than later debase their currency.

All people are looking for here is a safe way to store value over time. If governments would let people keep reliable records without bringing in the inflation tax or changing the rules, things like gold and bitcoin wouldn't be anywhere near as interesting. But they are interesting, because it is normally policy to block anyone who tries to store (small-time) wealth for more than a couple of years.

[Webox]

I don't get your argument.

Bitcoin is very very volatile and just because it went up the last x years, doesn't make it stable or trustworthy.

My money in my bank is very safe and it doesn't cost me anything.

The inflation itself is a systematic thing and should affect bitcoin equaly.

When corona came, i was looking at the stock market and was surprised how many people left it. It doesn't make much sense to distrist the stock market that much. After all alot of pension funds are existing, lots of companies or people who are self employed also have to keep their money safe. There is a lot of dependency on the share market and we are all bound to a certain degree of not being able to move it out asap.

[bradstewart]

I'm assuming you're in the US/Europe/somewhere with a stable currency. Places like Argentina that have had serious devaluation of currency do not see money in their bank accounts as "safe".

Bitcoin can provide a way for e.g. Argentinians to get their money into other currencies when the government is actively preventing that through "standard" mechanisms. It's safe (er, safer) from that perspective.

[M277]

How is it safe when it's so volatile and based on speculation?

As someone from a country which has had its currency's value slashed to half 5 years ago, I genuinely don't see how Bitcoin is safe at all. If anything, gold or real estate are safer.

Sure, if it is somehow guaranteed that I won't wake up tomorrow seeing 1 BTC = $30 000, I could see your argument. But is that guaranteed?

I would also like to add that the swings that BTC takes are unpredictable (at least for the common people who would benefit from it being a safe storage for their wealth).

[vernon99]

As somebody who saw family wealth slashed 100x due to crazy inflation just 20 years ago, 2x fluctuations are nothing. This is the perspective worth recognizing. Bitcoin is actually very stable by comparison. Edit: fat fingers typing.

[hooande]

This isn't a very good use case for bitcoin. It's very easy to buy coins, but getting your money out is as difficult as various governments want it to be. Most of the major exchanges have KYC and anti money laundering laws that can make it hard to transfer large amounts of any crypto into a spendable currency.

If a government is preventing people from transferring money through standard mechanisms, it's only a matter of time until they prevent them from using crypto to do that. If the best use is circumventing the law, it isn't much of a currency at all

[arcticbull]

A TransferWise Borderless account that allows you to store any of 80 currencies including the USD, in Argentina, is a much better system.

Not to mention, a $20 transaction fee in Argentina is devastating.

[roenxi]

> My money in my bank is very safe and it doesn't cost me anything.

Your money is safe, your wealth is not. Taking the US as a reference, it is official government policy that if you store your wealth as money then it has a half life of 35 years.

> Bitcoin is very very volatile and just because it went up the last x years, doesn't make it stable or trustworthy.

I was sneaky in my wording - I'm a gold bug and think Bitcoin is worthless. Nevertheless, a rational person who was interested in bitcoin would probably note that whatever its bad points it is simply not subject to the sort of technical intervention that makes fiat untrustworthy.

Also, using gold as a reference, the unofficial policy half life looks more like 12 years. Using the M2, maybe 14 years.

[arcticbull]

Supply is only half the inflation calculation, the other half is velocity. That's why the increase in the M2 supply doesn't translate to what you're paying at the grocery store. You've missed half the equation. [1]

[1] https://www.stlouisfed.org/on-the-economy/2014/september/wha...

[roenxi]

I'm not missing anything, I just don't care about the inflation calculation. I'm using gold and the M2.

[arcticbull]

lol, non-inflating is bad.

People aren't owed a risk-free return on thier capital and inflation is an incentive to invest. You're looking for a merged risk-free long-term store of value and medium of exchange. There's no reason to couple those two. It's actually counter-producive as they have different objectives. Money's job is to remain stable enough for as long as you hold it and cheap to transact. A long-term store of value's job is to go up.

Money is your short-term medium of exchange and lossy store of value. Which you use to buy long-term store of value. This is how capital is productively allocated while also creating a stable financial system.

The ability to adjust the money supply is crucial to reacting to shocks, to a changing population, and a changing economy. Taking away the knobs from the Fed removes their ability to create a stable monetary system in which business and individuals can operate.

If you actually look back in time you'll see under the gold standard, an attempt at this, boom/bust cycles were worse and more exaggerated. And much harder to control. There's no such thing as a free lunch.

This whole trope about the fed "stealing" 99% of money's value over the last 100 years is voodoo fringe economics. These are the people who used to hang out with megaphones at the corder of 5th and Market. Of course it went down, they told you it would, and they told you to buy something else with it.

[mountainriver]

Bitcoins wild fluctuations based on speculation would say it’s not a safe place to store value over time

[BTCOG]

Interesting that you should say the opposite of what JP Morgan is now saying. That the wild fluctuations are steadily going away as volatility has been calming down quite a lot.

[arcticbull]

JPM like Goldman are only interested in selling their clients what they want. It's what they do. And it's only to benefit themselves. These are the bankers Bitcoin was trying to overthrow lol doesn't that ring alarm bells? Remember?

[BTCOG]

We typically use the bankers as a sentiment indicator to show you folks who like bankers, that the bankers are getting into Bitcoin. The beauty in Bitcoin is these bankers enter in an equal or lower playing field to those involved. We don't seek permission from, or worry about said bankers.

They are pawns, if you will, to point to as jumping off points to your average Joe and say "Look! Your favorite X,Y,Z institutional guy is into Bitcoin now!" That is all.

[0xfaded]

In my world view, if you are actively removing wealth from circulation, then it should be disappeared.

But I do agree that it is too hard for the average person to save in the sense of "I will need to withdraw some wealth in the future". The best option out there seems to be ETFs. The dirty secret about the stock market though is that companies don't issue new stock nearly as much as one might think, and therefore the stock market is basically counter-parties playing off each other.

There are plenty of people out there with good, useful ideas and skill sets that really ought to be funded. And no, not all will generate VC like returns.

Figuring out how to link your minor excess now to your needs in the future in a way that isn't a net negative could very well be the defining problem of a generation.

[malka]

"a trusted party" does not exist at scale.

[FDSGSG]

Liberty Reserve was such a trusted party for a long time before Bitcoin became popular. In fact, there's a good argument to be made that the US government shutdown of Liberty Reserve is exactly what kicked off bitcoins popularity in the first place.

On May 6, 2016, the operator of Liberty Reserve was sentenced to 20 years in US federal prison

[o-__-o]

Including with Bitcoin, since 51% ownership of hash rate is simply a function of who has the most pooled resources (read: money)

[webinvest]

One such trusted party does exist. It’s a non-profit and it’s called the Stellar Development Foundation.

It’s cryptocurrency, the Stellar Lumens (XLM) is trusted well enough to be in the top 15 cryptocurrencies by marketcap. It has years of history to look back at. It doesn’t have a inflation rate (0% inflation rate now + occasional coin-burns).

It uses orders of magnitude less electricity than bitcoin because it uses distributed databases instead of ASICS, transactions are sent and received in a few seconds (near-instant), and transaction fees are less than 1 cent (just high enough to disincentivized spamming the network). Compared to Bitcoin’s $250 tx fee and Ethereum’s $30 tx fee, XLM’s tx fees are very cheap.

Finally you can buy XLM on most exchanges since it’s been around so long.

[BTCOG]

This is utter nonsense. XLM is founded by Jed McCaleb of Ripple and Mt Gox fame, and it's not a cryptocurrency. It certainly is not money. Bitcoin tx fees are readily verifiable on mempool.space and are currently $11-12 for a low-medium priority transaction. (One can easily get in for several dollars less, as well) When you insert such blatantly misleading and outright false information it brings into question everything else you said. Plus, it should be noted this fee is pretty high. The BTC tx fees lately have been averaging only around $5-8 and that is sending on Legacy.

[webinvest]

My mistake, bitcoin transaction fees are lower around $25 according to this chart[1].

Everything else in my comment still stands though and it certainly is a cryptocurrency.

[1] https://ycharts.com/indicators/bitcoin_average_transaction_f...

[gruez]

>It’s cryptocurrency, the Stellar Lumens (XLM) is trusted well enough to be in the top 15 cryptocurrencies by marketcap. It has years of history to look back at. It doesn’t have a inflation rate (0% inflation rate now + occasional coin-burns).

market cap =/= trust, especially when you consider that in the past there were outright scams that were in the top 15 (eg. IOTA).

[webinvest]

I don’t like IOTA. It was pretty overhyped for it’s value. I don’t know how many cryptocurrencies there are, maybe 10s of thousands, but being in the top 15 by market cap lends more credibility than in the top 1000 by market cap. Anyone can make a cryptocurrency, but not anyone can make it valuable.

[arcticbull]

> It’s cryptocurrency, the Stellar Lumens (XLM) is trusted well enough to be in the top 15 cryptocurrencies by marketcap.

lol, Dogecoin is #6 and XLM is #14. Are you saying your currency is less trusted than one with a dog on it?

[webinvest]

Possibly, yes? It’s not my cryptocurrency, it’s just one I’ve used and known about for a few years. Dogecoin is something else; I don’t know how that meme coin got so big. Also by your same logic, should we not trust the USDC stablecoin because it’s #18? Lol

[random_kris]

Where are you seeing $250 tx fee on btc? Are you in any way related to stellar? Reported

[webinvest]

My mistake, Bitcoin transaction fees are lower around $25 according to this chart[1]. Everything else in my comment still stands though. No I’m not related to Stellar, I’ve just known about Lumens and have used them for a few years now. I figured there might be some people here that didn’t already know about it.

[1] https://ycharts.com/indicators/bitcoin_average_transaction_f...

[minikites]

Is this a press release?

[FireBeyond]

> All people are looking for here is a safe way to store value over time.

There are ways to do so that don't involve scenarios literally as absurd as _buying power plants_ to do random equations.

Perhaps some of that desire for a safe value store should be invested in that direction.

[cabalamat]

> Except that isn't going to work, because governments are untrustworthy

Some governments are more trustworthy than others, and lots of people trust some governments. For example many people hold USD because they consider it a better store of value than their own country's currency.

> a trusted party could run a big relational database that was basically a non-inflating currency and really cheap to run

Somewhere like Switzerland would probably be quite trusted to run this.

[pydry]

There are plenty of inflation proof assets out there. Bitcoin's value lies in its immunity from government oversight and transportability.

It's most useful for transactions or transfers that are illegal somewhere. A government can deprive a criminal of a house more easily than a password.

I suspect it was embraced by western governments because it facilitates capital flight from the developing world to the developed world - especially from China.

[CTDOCodebases]

Once the gold is extracted how much energy is spent to transport it, turn it into jewellery and store/protect it throughout its lifetime?

[throwaway271818]

Where did you get the 100g of e-waste figure from btw? Is that, roughly speaking, the e-waste mass of storage/txn * total number of nodes?

[arcticbull]

Digiconomist [1]. I should have linked it up top, my bad.

Looks like they, in turn used this reference [2].

[1] https://digiconomist.net/bitcoin-energy-consumption/

[2] https://www.cell.com/joule/fulltext/S2542-4351(19)30087-X

[throwaway271818]

Ah, but they’re calculating e-waste in the form of specialized mining hardware (ASIC) that, at present, goes obsolete every few years.

The e-waste generated this way is not an intrinsic cost of handling a transaction, since the hardware could hypothetically be reused or recycled. It seems unwise to think of it as an irreducible cost per txn, rather than a dynamic figure that would likely improve over time (especially if the carbon externality were appropriately taxed)

[ta988]

But is it recycled? From what I understand it cannot be reused as a device, it has to be reprocessed to extract metals and such. So the value is pretty low and losses are high.

[celticninja]

This is a better index and not run by someone with an axe to grind https://cbeci.org/

[arcticbull]

The number you link is 43% higher.

[AustinDev]

Gold mining btc mining isn’t the best comparison. For your 5X number. You’ve still got to ship and store the gold which undoubtedly has additional environmental costs.

[CTDOCodebases]

The miners don’t compute hashes of random data. They confirm transactions.

If you don’t think that a technology that allows you to store value in a tamper free digital ledger is useful it’s hard to argue the usefulness of PoW crypto currencies to begin with.

[berdario]

The nonce used as input of the mining hash function IS random (or rather, arbitrary).

Comments like the above are a sad demonstration of the fact that, while Bitcoin was originally an interesting technical project... Discussion of it has now been completely taken over by shills that try to dismiss/refute/hide all of the problems with Bitcoin (or the cryptoasset du jour) to safeguard their bet

[Siira]

You’re just deflecting. Your argument is as invalid as “mutations are random so evolution is false.” Randomness in an algorithm does not mean the algorithm is non-converging.

[berdario]

I never said anything about converging or not. My GP's post simply points out that having repeated computations with arbitrary input is wasteful.

"Your argument is as invalid as..." ROTFL

Wake me up when Bitcoin moves to a PoS consensus

(Btw, I recommend whoever is reading to also steer clear of PoS coins... If you want to invest, look elsewhere)

[UncleMeat]

What if we had 1000x the power being used to confirm transactions? 1,000,000x the power? At some point we aren't achieving anything.

The is made worse by the fact that there are alternatives to produce trustworthy ledgers that don't involve destroying the planet.

[Siira]

Yes, alternatives that work for rich, powerful people.

[reynard_le_faux]

These people buying power stations aren't rich?

One of the issues with crypto currency is that we're replacing one elite with another.

As John Oliver says Cryptocurrency is everything you don't understand about finance combined with everything you don't understand about computers. That new, even eliter, elite is probably no more moral or ethical than the old.

It's not like cryptocurrency is more accessible. Maybe it will become so but I still have to fork out a lot of money to buy Bitcoin. It's just the fees get paid to different people.

Not entirely sure how it's better. It is different though, I'll give you that.

[jessaustin]

Bitcoin is like any other infinitely divisible asset. You can buy as much or as little as you want.

[tsss]

It does so with the same efficiency as a Rube Goldberg machine moves a marble from one place to another.

[CTDOCodebases]

Efficient or secure. Take your pick.

[salawat]

I"ll hire a few guys with guns, plus auditors. Their ability to maintain no sense of humor beats out your wonky crypto scheme in both regards. Your issue is you don't like the rules that come with the auditors. Those rules have a purpose, and that purpose is tied with sovereign diplomatic interrelation of civic bodies the world over.

Many of whom are expressing great concern over the very thing PoW hastens.

So no, it isn't either or. It's stop jeopardizing the planet in the long term so you can do whatever you're doing now. I don't care that you're doing it, and we can talk civily about the warts of the financial system so it can be tuned to meet your use case better and cone to a compromise; but PoW has the worst set of dysfunctional societal incentives I've seen in my life.

[gruez]

>I"ll hire a few guys with guns

A few guys with guns can be beaten by several other guys with guns.

>plus auditors

https://www.wsj.com/articles/wirecard-scandal-puts-spotlight...

[imtringued]

Jewelry is a surprisingly big chunk of global gold demand. Yes it is ultimately meaningless other than to impress other humans, however this meaningless activity is part of human nature. We derive joy from it.

Meanwhile Bitcoin is just a means to an end, getting rich quick. The fun doesn't happen because we have Bitcoin, but rather because we get rid of them for an unreasonable price.

[CTDOCodebases]

It could be argued that people are flocking to Bitcoin not to increase wealth but to preserve it over a long period of time.

I don’t know where you live in the world but where I live wages haven’t risen in line with the cost of food and shelter.

Leaving money in the bank is like working to buy a block of ice only to watch it melt away. To argue that any store of value isn’t speculative to some degree is naive.

[etripe]

> To argue that any store of value isn’t speculative to some degree is naive.

Isn't there a difference between currency in general being speculative to some degree and cryptocurrencies specifically, whose main value proposition is speculation?

[CTDOCodebases]

I wasn’t referring to fiat currency since that is a terrible store of value. It is guaranteed to have less buying power in the future.

What I was referring to was stocks since they have outperformed government bonds and gold the last few years. Take Amazon for instance. I don’t think the share price is equal to total assets minus total liabilities divided by number of shares. Amazon doesn’t issue dividends so why did the shareholders pay so much for the shares?

[ballenf]

Maybe humans were created by an ET life as mining/purifying beings whose sole purpose is to be dropped on planets and left alone for a few millennia to do their thing.

The ETs come back once all the minerals are refined and purified and neatly stacked.