keybored
Well done. You remember cat good.
I made a transaction for £80 yesterday, it took around 30 minutes to confirm and the fee was not much over £2. I'm struggling to believe that that used enough electricity to power a house for three months.
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littlebabyjesus
one of Maxwell's demons
This is where it goes exponential, which is bad. The value of bitcoin goes up, making mining the blocks more attractive, so more people try to do it, and according to wikipedia (my source for this, but looks pretty good), the output is limited by a feedback system that makes them harder to mine according to how many people are trying, and the difficulty level has already zoomed up. There are likely to be an insane number of people trying to mine them right now. Cue an exponential growth in energy usage by the miners.
The whole thing is insane.
mauvais
on reddit or something
You have a wallet of BTC. All mining ends. You can sell me the rights to your wallet outside of blockchain and I will own the magical coins of uselessness. Value is transferred, but we've circumvented the point of cryptocurrency.
joustmaster
offcumdun
Exactly, right?
A block has somewhere between 1000 and 3000 transactions.
And there's a block every ten mins.
I'd like to see the calculations the power consumption came from.
I'd also like the spare time to look at it.
joustmaster
offcumdun
Oh right.
But how do you know that the other person hasn't kept a copy of your key/wallet?
not-bono-ever
meh
But it cannot mine when the vein is exhausted.there are 21 Million of them out there- what then? at that point they may have a value/ worth but invariably aginst real world goods. the pricing at the minute is driven partly by the energy needed to get the fuckers but mostly by carpetbaggers who want to be in the game.Will they move onto to the next big thing and dump their stash ?
it is fascinating but smells slightly unhinged.I am trying to relate this to what I know in the real world and isnt conencting. If I go and mine Bauxite, I know that I can expend real world energy to make into alumina and them a load more to get aluminun. then I can make things that can add value from it- like gardening tools to produce crops. I can see the connect here, I can even view the aluminum ingots as a tangible repositary of energy expended- but i cannot see the end game with BC.
lolz
Marx would be pulling his beard hairs out at this
it is fascinating but smells slightly unhinged.I am trying to relate this to what I know in the real world and isnt conencting. If I go and mine Bauxite, I know that I can expend real world energy to make into alumina and them a load more to get aluminun. then I can make things that can add value from it- like gardening tools to produce crops. I can see the connect here, I can even view the aluminum ingots as a tangible repositary of energy expended- but i cannot see the end game with BC.
lolz
Marx would be pulling his beard hairs out at this
joustmaster
offcumdun
They do half the amount of reward you get for mining after a certain number of blocks are mined.
(although I doubt that would make much difference.)
mauvais
on reddit or something
You don't, in its rawest form, but then AFAICS there are various ways round this (see 'off-blockchain transactions'), as well as various trust risks in the normal use of it, like whether you trust the wallet provider.
joustmaster
offcumdun
The "mining" continues after the limit is reached. The payment is the transaction fees for that block
joustmaster
offcumdun
double dodgy.
littlebabyjesus
one of Maxwell's demons
Well, if the energy currently being used to mine bc is equivalent to the energy consumption of Ireland, which is one thing I read, you could work it out relatively easily. There's a block every ten minutes. Taking the upper end of your calculation, that's around half a million transactions per day. That's not that much. There are way more than half a million homes in Ireland, and homes aren't the only things being powered.
It's in roughly the right ballpark. So that has to mean that someone somewhere is spending an awful lot of money every time you use bitcoin. This has to be a classic ponzi scheme, no?
not-bono-ever
meh
bottom line- is this a useful way to use real world energy? what could you do with that energy that is of benefit to mankind .
joustmaster
offcumdun
But where does that ireland number come from? Whats the calculation behind it?
littlebabyjesus
one of Maxwell's demons
Yep. And that energy consumption is only going to zoooom up. Then in five years' or something, someone finds a way to to do it almost instantly with a quantum computer, and with any luck is a public-spirited person who crashes the whole thing. Or maybe it collapses next week?
Bitcoin mining consumes more electricity a year than Ireland
This bit makes some sense, I guess. And this is why it must be a ponzi scheme - the miners are mining for the bitcoin itself, not any kind of transactional use value that it might represent, given that the true fee they should be charging for transactions would be astronomical.
That has to suggest an imminent collapse. We're at the stage where the tulip bulbs are changing hands for thousands of pounds each.
littlebabyjesus
one of Maxwell's demons
this part of the ponzi scheme really fucking bugs me, tbh. Fuck's sake, humans, what the fuck are you doing?
joustmaster
offcumdun
Theres no calculations there.
There are some assumptions though. They based it all off one mining operation where they weren't told what H/W they used...
I do not doubt that this burns a lot of energy. I'd just like to see the working.
littlebabyjesus
one of Maxwell's demons
Thing is, let's say they're quite a long way off, and it's only a week's worth of homes in Ireland per transaction. That's still a fortune, and it still indicates a pyramid scheme. If the number of bc transactions per day is limited by the one block per ten minutes rule, that ought to set a pretty clear upper limit on the value of a block. But it hasn't. When the whole thing collapses, it will be the final set of miners who will be the big losers.
not-bono-ever
meh
i posted a link ealier about a Russian mine that is using serious electricty from coal fired power stations to meet its huge demand to run the 'puters. then they need leccy to then cool down the 'puters . does this not seem barking ?
not-bono-ever
meh
sorry, have been thinking about *green* economics of late and have a bit of a hump about stuff like this. time for me to fuck off
littlebabyjesus
one of Maxwell's demons
It's insane. I've read bc described as a collective delusion. I totally agree.
keybored
Well done. You remember cat good.
I think I found it. The story seems to be based on this 2014 study http://karlodwyer.com/publications/pdf/bitcoin_KJOD_2014.pdf
Conclusion said:
Which is exactly why a transaction with a fee of under £3 can't be using enough energy to power a house for 3 months.
not-bono-ever
meh
i have just got a glass and filled it with ice from the freezer, the stuck in in the microwave to melt it back into water. I may have spunked loads of energy but at least I have some tepid water now. Same temperature as the tap funnily enough.
littlebabyjesus
one of Maxwell's demons
No, it can be if the reward for mining one block is a dozen or so bitcoins worth $10,000 each. At today's prices, one block is worth more than $100,000. The transaction fee is almost irrelevant, tbh, which is why it appears you can get free ones if you're prepared to wait a bit. Problem is that bcs are entirely useless for anything other than making transactions. Hence it's an absurdly inflated bubble.
joustmaster
offcumdun
The reward for mining a block is pretty standard.
12.5bc reward plus 1.5bc fees
littlebabyjesus
one of Maxwell's demons
Maybe some good will come out of this ridiculous waste. Computers will be improved no doubt after some of the best brains have dedicated themselves to this useless task in the name of making money out of doing something of no value. It's not exactly the Apollo program though, is it?
keybored
Well done. You remember cat good.
Then the transaction claim I am questioning is hugely misleading, as once mined a Bitcoin (or a fraction of it) can be traded many, many times without having to pay the initial cost of the mining over and over again.
littlebabyjesus
one of Maxwell's demons
We're bumping against my ignorance here, but my understanding is that each block is a block of transactions - that's what a block is. And these are added six times per hour. Each time this is done, new bcs are released and given to whoever 'mined' the block. The pile of blocks is bitcoin, and is stored on every node in the network, hence no central authority.
The wiki page gives a decent explanation of this, and if I'm understanding it correctly, without the mining, there can be no transactions on the block. The lecky used to do the mining is an essential part of keeping the system going, so I think it's entirely fair to divide the cost by the number of transactions to come up with a real cost for the activity that bc represents. As mauvais said, without mining, you can't transact via the block, you can merely sell the private key to your account to someone else, which defeats the point of it.
keybored
Well done. You remember cat good.
Which would be like saying "It costs £5k to mint 1000 pound coins, so every time someone uses one it costs £5".
I appreciate that mining Bitcoin uses a lot of power, and that deserves scrutiny. But it's hard to take that seriously when people are claiming that every transaction (with a fee of a few pounds, or even no fee as you've pointed out correctly) uses enough power to run a whole house for three months. Who is paying for the power? Even miners aren't going to do it at a loss.
littlebabyjesus
one of Maxwell's demons
No miners releasing new blocks means no new transactions. This isn't a one-off cost to release new bitcoins. It's an ongoing cost to produce each new block of transactions, which also releases a few new bitcoins at the same time as a reward for the miners. Because the price of bc has gone through the roof, the miners are spending enormous amounts of real resources to mine them, but that doesn't produce value. The only actual value to the system is that it enables transactions, but it actually enables not that many transactions - less than half a million per day. To put that in context, it's a few seconds' worth of Visa transactions. A huge expenditure for a currency that's really tiny.
It's a pyramid scheme.
newbie
undisambiguated
I sortof agree, although I'm very doubtful I'll understand the calculation
I've been looking for something comprehensible, the best I've come up with is The Ridiculous Amount of Energy It Takes to Run Bitcoin from the IEEE which is worth reading and provides a bit of interesting background
this paper (which I don't pretend to be able to read properly) considers the effectiveness of the ASICs used for modern mining. The author estimated the overall Bitcoin electricity consumption to be around 4.5TWh/year as of last February, and nearly doubled that to around 8TWh/year in July.
The Bitcoin Energy Consumption Index - Digiconomist site uses a rather simpler system based on the total revenue mined then estimating that miners spend 60% of their revenue on electricity. Their current estimate is somewhat higher at 30TWh/yr.
Given that mining is distributed around the world, and ranges from room heaters to factories and uses all sorts of different electricity supplies, I'm rather doubtful that the actual consumption can be measured accurately. The fundamental is the hashrate, which is undoubtedly increasing in both quantity and the power required per block.
sorry they're so big
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