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Is Bitcoin Mining a Real-World Environmental Problem?
First time accepted submitter HeadOffice writes "Mark Gimein points out that Bitcoing mining uses a lot of power, enough that it is a real world problem: 'About 982 megawatt hours a day, to be exact. That’s enough to power roughly 31,000 US homes, or about half a Large Hadron Collider. If the dreams of Bitcoin proponents are realized, and the currency is adopted for widespread commerce, the power demands of bitcoin mines would rise dramatically. If that makes you think of the vast efforts devoted to the mining of precious metals in the centuries of gold- and silver-based economies, it should. One of the strangest aspects of the Bitcoin frenzy is that the Bitcoin economy replicates some of the most archaic features of the gold standard. Real-world mining of precious metals for currency was a resource-hungry and value-destroying process. Bitcoin mining is too.' However, not everyone is convinced that virtual mining is as bad for the environment as the real thing."
Well, the key question - as with anything that operates on a stock market type setup - is, "what's the market depth?"
So few bitcoins change hands, relative to the total number out there, that a fast dump would see the value crash. This is part of the reason that the bitcoin market is so volatile: because relatively few people are selling or buying, the "value" changes very easily. All it takes is one relatively large buy order, and the price will spike; alternatively, one relatively large sell order, and the price will plunge.
In short, my considered advice to anybody looking at bitcoins as a way to get rich quick: it's a pyramid scheme, or a very close relative thereof. Steer clear. It simply isn't worth the risks.