[survirtual]

For Bitcoin and other PoW coins, the value is built into the name for minting: Proof of WORK. Less abstractly, today we can think of this as proof of energy consumption / production. In other words, it is sort of crystallizing energy into abstract & transmissible value. By holding a coin, you hold that value / solidified energy.

It takes a certain and increasing amount of energy to generate 1 coin, which binds the value of the coin to physics. This is actually a very good thing, especially given it does not care where the energy comes from. If nuclear, solar, window, hydro, and thermal were our dominant energy sources, it would work in that just as well and without bias. Indeed, it actually has active market incentives to utilize clean and renewable energy sources — something the previous financial mechanisms grossly lack.

Existing banking institutions consume more energy in unmeasurable ways, and they DO care where the energy comes from: oil. They want oil. It’s called the petrodollar for a reason.

[thatjoeoverthr]

Work isn’t value. It’s cost. It’s not crystallized; the capacity to do that work is spent and gone. If you mine and sell a bitcoin, your profit is the revenue -minus- that work.

(Not anti-crypto, just contesting this point.)

[bitxbitxbitcoin]

Good point. I try to identify the work/value that goes behind the USD. All the manhours and energy put into civic duties (military, government, etc). Also largely in the past and similarly uncrystallized, but somehow people find it to be more cyrystalline.

[lupire]

You're right that a lot of waste is miscounted as value -- this is why GDP is not the same as quality of life (even ignoring uneven distribution or logarithmic utility functions.), and part of why "purchasing power parity" and "cost of living" is different in different places.

[ttul]

Except that, in practice, because crypto mining can happen anywhere there is electricity, people exploit weak governments to get their electricity from the cheapest possible source. And to the extent that crypto miners are competing for scarce electricity resources, they increase the cost of electricity for other uses, crowding out, for example, its use for heating and light.

These are not good things.

[ARandumGuy]

> This is actually a very good thing, especially given it does not care where the energy comes from. If nuclear, solar, window, hydro, and thermal were our dominant energy sources, it would work in that just as well and without bias. Indeed, it actually has active market incentives to utilize clean and renewable energy sources — something the previous financial mechanisms grossly lack.

Bitcoin incentivizes mining using the cheapest source of electricity, not the greenest. Bitcoin miners are more then happy to move their mining rigs to places with cheap coal electricity.

The fact of the matter is, we need to not only move to producing more green power, we need to reduce the global power consumption. Green power still has negative environmental impacts, and there's practical limits to the amount of green power we can generate. Crypto mining is actively hindering efforts to reduce global power consumption, by consuming every spare bit of power it can.

Global warming is an existential threat to human civilization, and will likely negatively impact billions of people, if not everyone. Reducing power consumption is not optional. Bitcoin and POW cryptocurrency are making it harder to do that, and that should be enough to oppose them.

[deprave]

So I can pay my utility company $100 a month for energy I consume, or pay $40000 for a bitcoin representing energy someone else consumed? Got it.

[bitxbitxbitcoin]

Yes. How many ways do you have to reliably monetize a portion of that $100 that goes to the utility company, though? At its core, proof of work (not Bitcoin's anymore because of ASICs), allows that.

[lupire]

I dont need to monetize it, I can keep the $100 and not buy the energy. And it's not "reliable" if I get rug pulled (extemely common) or someone else has a more effcient mining setup (extremely common).

Maybe if I'm stuck on inefficient resistive heatong in winter, mining makes sense.

[Scoundreller]

That’s how much it would take to produce another one. Most cost a much smaller fraction of that.