[incomethax]

So I work in the energy sector, and you are correct. The method we use for pricing power at a grid level is "local marginal pricing" - this is a price that is based on the location, the demand for power, and the ability for us to get the power across constraints (that is across a power gradient). It is often uneconomical to transmit power great distances, and loss factors are not insignificant. Not sure about Bhutan's grid, or who they can interchange to, but there are frequently wind farms in TX that have to take a loss to generate power simply because they are forced to generate power, and there is no demand for power in the region, and the buses (power lines) are congested. Also stranded hydropower is common the world over - it's easy to generate that power but difficult to build grid and interconnects to transmit that power - the line losses would be too high. For other types of generators - typically nuclear, often times ramp times for them are in the months, so turning up and turning down power is often difficult which is why an application that is passive, droppable, and can withstand latency is ideal to consume such power.

[arcticbull]

> ... so turning up and turning down power is often difficult which is why an application that is passive, droppable, and can withstand latency is ideal to consume such power.

Sure, so investing in smart load management is an optimal solution. With EVs and chargers coming online that's a huge load you can send a signal to in order to adjust demand. A country like Bhutan is very well suited to this kind of approach.

Or change the energy mix so you have a balance of baseload and variable load generation.

Or do something with it that isn't guessing random numbers on machines 99.7% of which will never successfully guess a single block and go from factory to space heater to landfill.

Can't remember which miner, but one of the majors, made more money in credits for pausing their waste than they did from the bitcoins that came out the other end last year. It's just extorting the public.

> Not sure about Bhutan's grid, or who they can interchange to, but there are frequently wind farms in TX that have to take a loss to generate power simply because they are forced to generate power, and there is no demand for power in the region, and the buses (power lines) are congested.

So invest in building more power lines.

The myth of stranded energy is toxic. Wasting it on bitcoin mining is an incentive not to connect it to the grid the way it should be connected. Either don't build it, or build it and connect it. The worst case outcome is to build and then waste it.

Transmission losses are only 2-3% per 1000km.

[peyton]

You’re suggesting Bhutan alter their national energy mix rather than run a Bitcoin mining operation?

Bhutan has 0.15 vehicles per capita, among the lowest in the world. 47% of their popular has no education. You’re saying Bhutan should build a smart grid for EVs rather than run a Bitcoin mining operation?

I think that’s kinda ridiculous.

[lordlimecat]

Bitcoin mining generates literally no value for 99.99% of the population, so anything that improves the infrastructure is going to be more valuable than that.

[MadcapJake]

The maintenance cost of an EV network would far outweigh the cost to maintain a mining op.

[arcticbull]

Not really, I'm suggesting they sell more power to India which is what they do already. They can do that by lowering the price per kWh.

> You’re saying Bhutan should build a smart grid for EVs rather than run a Bitcoin mining operation? I think that’s kinda ridiculous.

Not just EVs, there's plenty of things you can make demand-responsive. Do something - anything - with it. Electrolyze water for hydrogen. Electric smelters. Power for a data center! The world is your oyster.

What's ridiculous is wasting the power on lotto tickets and e-waste and furthering the single least efficient technology humanity has ever conceived of.

[datadata]

> Or do something with it that isn't guessing random numbers on machines 99.7% of which will never successfully guess a single block and go from factory to space heater to landfill.

By this logic we should remove airbags from cars also-- the vast majority of airbags just cost money to manufacture and don't ever expand or save a life, ending up in landfills unused.

[arcticbull]

I'm genuinely having a hard time following your argument.

An anti-efficient transaction processing system (that gets less efficient the more people mine) managing 2-3 transactions per second is the same as ... airbags ... because they're not used in the ideal outcome?

The majority of electricity used to mine bitcoin (about 100TWh per year) is coal, and coal kills about 25 people per TWh generated. So it's steady-state responsible for about 1000 deaths per year if we assume only 40% of the power is coal. The Verge says its about 85% coal and gas. [1]

What's the quantity of resources consumed by airbags at rest?

Bitcoin doesn't 'just cost money' to make, it consumes wild quantities of power and yields wild quantities of e-waste. 100TWh per year and 54kT of e-waste.

If we followed this model, would you be ok with each laptop you buy yielding 333 identical laptop in a dumpster somewhere ... because airbags?

Like I said, I'm having trouble following this argument. Is there a chance your argument is less about airbags and more about, er, somewhat heavier bags?

[1] https://www.theverge.com/2023/4/10/23677113/bitcoin-mine-inv...

[datadata]

Your argument (I think) is that bitcoin mining machines that don't solve a block directly are a complete waste, and only bitcoin mining machines that that solve a block do anything useful. Since 99.7% of mining machines don't solve a block, bitcoin is 333 times more wasteful than in needs to be. Is that right?

This misses the point that mining is probabilistic. Mining pools pay out based on the number of hashes tried, not the number of blocks solved. Your misunderstanding seems to be that the utility of something can be based on a probabilistic outcome. It is akin to saying that airbags are 99% (or whatever) wasteful because most of them aren't actually involved in a crash, and therefore 100x inefficient. You pay extra for a car with an airbag because it has value in the rare event you do have a crash it has immense value. Similarly, a mining pool would pay a single bitcoin mining rig to mine for years without it solving a single block, because the mining pool would realize the entire value if it did find a block, and so it pays out just under the expected value of this reward times the probability of the event happening.

Second, your argument ignores the fact that the unit of a "mining machine" is completely arbitrary. If mining machines were on average 2x larger and more powerful (but there were half as many of them), then by your argument bitcoin mining would be 2x less wasteful. That makes zero sense.

[arcticbull]

> Since 99.7% of mining machines don't solve a block, bitcoin is 333 times more wasteful than in needs to be. Is that right?

Absolutely not, it's millions of times more wasteful than that. You don't need to allocate a single miner to a single block and then throw it out. It's just so many order of magnitude more wasteful than it needs to be that it's hard to reason about. You should be able to run the entire Bitcoin network on a single Raspberry Pi. It's literally 2tps, each a few bytes.

> Your misunderstanding seems to be that the utility of something can be based on a probabilistic outcome.

There's no misunderstanding. The kWh and kT of e-waste don't need to happen, it's just a poorly designed proof of concept that ran amok.

> If mining machines were on average 2x larger and more powerful (but there were half as many of them), then by your argument bitcoin mining would be 2x less wasteful.

No, I'm measuring waste by weight, in kilotons per year. In addition to energy consumption. So if a machine was twice as large it would contribute the same amount of waste in both columns.

[datadata]

OK, let's make this a multiple choice question. Assume bitcoin mining machines magically each become twice as powerful, AND twice as heavy, but there are half as many of them, so the total energy and resources used is exactly the same. According to your argument is this change:

a) good, because now twice as many miners actually solve a block, so instead of 99.7% waste it is 99.4% waste.

b) doesn't matter, because I just changed the unit of measurement-- each machine is just doing twice as much work.

c) doesn't matter, because bitcoin is already infinitely wasteful-- in which case pointing out that 99.7% of machines are somehow more wasteful than the other 0.3% does not make sense.

d) bad, for some other reason.

[vxNsr]

Not to detract from anything you said but I read that Texas specifically is unique in that they don’t want to connect to the national grid to avoid being regulated by the federal government. It creates other problems like we saw in 2021 as well