[tveita]

Keep in mind that the entire Bitcoin network could be replaced with one trusted party with the computing power of an average smart phone. The network is currently paid 150 Bitcoins every hour to be that party, and in an efficient market, almost all of that would be spent on mining, i.e. wasted.

The security of Bitcoin against double-spending is literally based on wasting so much money that it is unattractive for an attacker to spend a matching amount of money on a double-spend attack. The network must spend this money all the time, though - it can't know in advance when it is being attacked.

An attacker with enough resources can also force the network to either match their spending, or be rendered useless.

Bitcoin is an inherently wasteful system, and it actively resists scaling. There are alternatives, the most proven of which is a centralized ledger run by a trusted third party.

Even if there were no viable alternatives at all, I would still have doubts about the sustainability of the current system. The cost of running the network is just too large compared to the amount of real economic activity.

[baddox]

I think you underestimate and/or understate how big of a deal Bitcoin's lack of reliance on a trusted third party is. That's essentially the entire point of Bitcoin, so it seems a bit disingenuous to call it "wasteful." Perhaps if you have no desire for a decentralized transaction log with no trusted third parties, then it would be wasteful for you to throw computing resources at Bitcoin, but it's ridiculous to apply that generally.

[Dylan16807]

Still, think about how the proof of work operates. There is no connection between the amount of computation needed to prevent attacks and the current block reward. Therefore logically the amount being spent on mining is very probably far too high or far too low. It's possible that it's too low, and bitcoin could be taken out by a government body. I personally think it's more likely to be too high. As in, X attack only needs to cost $1M to keep the network safe, but the current mass of miners makes it take $10M. The other 9 million is truly wasted on the tragedy of the commons.

To go back to the silly analogy, you need a 20 ton lock but you can only use 'cost plus' bidding and all the contractors keep making the lock bigger until they get every possible cent out of the process.