[bunderbunder]

The vast majority of fiat currency in circulation isn't in the form of banknotes or coins. (Gold isn't really a currency anymore, so let's ignore that one.) It exists electronically. In a fractional-reserve system, it's also mostly created by its users, but that happens as a by-product of normal economic activity. And it takes a lot less computer work per economic transaction for a fractional-reserve system to create money than it does in a cryptocurrency.

[nmjohn]

You are completely ignoring the issue. Just because a majority of money exists electronically doesn't mean a lot of money isn't spent on paper and metal versions.

The United States alone spends tens of millions of dollars a year on producing pennies - beyond the face value of the pennies.

So the entirety spent on mining bitcoin is not too far off from what one country spends just on minting pennies.

[bunderbunder]

No, I'm trying to focus on the forest instead of the trees.

It's true, pennies are a horrible waste. It costs almost $0.02 to make one, and nobody even likes them very much, but the mint still churns out billions of the things ever year. That should probably stop.

But overall, coinage is a tiny fraction of the overall dollar economy. And Bitcoin isn't really comparable to coinage, anyway, since BTC is not a fast, convenient, anonymous, peer-to-peer mechanism for exchange that's appropriate for use in small transactions. Compared on that level, BTC seems sub-optimal long before we start worrying about details like energy efficiency of production.

What BTC really compares to is a currency in general, such as the dollar. There BTC at least has a chance of comparing on a vaguely level playing field. And at that scale, pennies are insignificant.

[bduerst]

It's interesting that you mention pennies because there's a push to have them eliminated. It's almost a cultural phenomenon that they still exist.

http://en.wikipedia.org/wiki/Penny_debate_in_the_United_Stat...