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Bitcoin Mining Now Accounts For Almost One Percent of the World's Energy Consumption (theoutline.com)
It is well-established established that Bitcoin mining -- aka, donating one's computing power to keep a cryptocurrency network up and running in exchange for a chance to win some free crypto -- uses a lot of electricity. Companies involved in large-scale mining operations know that this is a problem, and they've tried to employ various solutions for making the process more energy efficient. But, according to testimony provided by Princeton computer scientist Arvind Narayanan to the Senate Committee on Energy and Natural Resources, no matter what you do to make cryptocurrency mining harware greener, it's a drop in the bucket compared to the overall network's flabbergasting energy consumption. From a report: Instead, Narayanan told the committee, the only thing that really determines how much energy Bitcoin uses is its price. "If the price of a cryptocurrency goes up, more energy will be used in mining it; if it goes down, less energy will be used," he told the committee. "Little else matters. In particular, the increasing energy efficiency of mining hardware has essentially no impact on energy consumption." In his testimony, Narayanan estimates that Bitcoin mining now uses about five gigawatts of electricity per day (in May, estimates of Bitcoin power consumption were about half of that). He adds that when you've got a computer racing with all its might to earn a free Bitcoin, it's going to be running hot as hell, which means you're probably using even more electricity to keep the computer cool so it doesn't die and/or burn down your entire mining center, which probably makes the overall cost associated with mining even higher.
"It is well-established established that Bitcoin mining -- aka, donating one's computing power to keep a cryptocurrency network up and running in exchange for a chance to win some free crypto -- uses a lot of electricity." Not quite. No one is using their computer to mine bitcoin. That hasn't been profitable in many years. People are using dedicated highly specialized hardware that can do nothing else except mine, ASIC, application specific integrated circuit. This isn't really donating your computer power since these ASICs can do absolutely nothing else. "Computing power" implies something a little more general purpose.
First: "Gigawatt" is not a quantity, it's a rate. You don't use "gigawatts each day". You probably mean GWh (gigawatt-hours).
Anyway, there are really two inputs to the mining equation. The first is electricity cost per hour of mining operation and the second is cryptocurrency value produced per hour of mining operation.
Making mining more efficient will *increase* mining activity, at least until the market adjusts. (Because, the value of cryptocurrency produced per hour is directly influenced by how much mining hardware is in use network-wide). More efficient mining equipment reduces the electricity cost, therefore mining is more profitable, therefore it is done more. In no way would making mining equipment more efficient make the network use less electricity.
Besides, there's a fundamental limit at work here... the reason that mining is electrically and computationally expensive is explicitly intended. The only reason the network works is because it is expensive and time-consuming to mine. That's the security mechanism that makes the thing work, and the core concept behind the blockchain.
Bitcoin mining power usage estimates: 1-4 GW (anonymous experts quoted by Washington Post; Dec 2017), 3.3 GW (Power Compare, a consultancy; Nov 2017), 0.5 GW (some random blogger who shows his working; Mar 2017). I'm going to trust the last of these to be most reliable, and add a factor of two for a year's worth of growth, and guess 1 GW, acknowledging that there's a big error bar here.
Taking a major gold-mining company (Newmont), their energy usage is 40-50m GJ = 1.4 GW. This is about half diesel fuel, and a quarter from the grid. They produce ~5m oz/yr of gold, out of a total global production of 4000 t/yr = 140m oz/yr (some well-referenced table on wikipedia; 2013). Assuming this company is typical, this implies total energy usage for gold mining of 40 GW; the figure for 2018 might be ~2 times higher, judging by the growth trend.
Finally, total global power consumption is ~18,000 GW (an IEA report linked from wikipedia; 2015). So bitcoin mining is ~0.01% of total power usage, and gold mining is ~0.2% of total power usage.
Conclusions: (1) bitcoin mining uses much less (~40x less) power than gold mining; (2) the title of TFA is utter bullshit.
This means 75% of all food he eats is imported, which in turn means
the GBP he pays for the food must be converted to EUR, for which someone pays the bank 4% which means
3% of his food bill goes to the bank AND
the country has to export the value of that food (mostly through soliciting foreign investment in over-priced property and the bank takes 4% of that to convert the EUR back to GBP - SO
The bank gets 6% of the value of the food he eats ON TOP OF the 2% it takes when he pays for the food.
And the clever thing (from the bank's point of view) is: this also applies to pretty much everything else he buys except the rent - but of course, if he has a mortgage, the bank is probably taking about 5% of that as interest too.
But never fear, the government is probably taking 20% VAT on most stuff he buys AND 30% in income tax and national Insurance on what he is paid.
So, in summary:
If he lives in the UK, he is (financially) stuffed, regardless of Bitcoins! (Takes one to know one). But, don't worry, it will be way worse after Brexit, when he will pay WTO tariffs of, on average 50% tax on anything he even thinks of buying. Get the facts: http://www.youtube.com/watch?v=svwslRDTyzU&t=3s
Disclaimer: If I was a Russian troll, all the above figures would be even worse!
Sent from my ASR33 using ASCII
No commodity that constantly rises in value can be used as a currency.
Cryptocoin don't constantly rise in value, they constantly jump madly around like giant random number generator (due to a too weird and completely unregulated market - that last part is the whole point of their decentralized system).
This make them hard (or more precisely: risky) to hoard, as in keeping them as an investment.
This don't prevent them to be used as form of payment (more precisely: a payment-over-internet-without-a-central-autority <- the whole point of their invention).
You use which ever way you want to convert you stable fiat USD into bitcoins (e.g.: you might be using a coin processor like bitpayment, but you might as well be trading them on IRC), and the marchant your buying stuff from will use which ever stuff he wants to convert them into their local stable EUR (usually some payment processor. Let's say coinbase this time, for the sake of variation).
You use only stable USD.
The marchant only use stable EUR.
the volatile BTC are only used during the transaction.
The fact that these BTC were valued at some completely different exchange rate yesterday, and will tomorrow exchange at yet another completely random rate, depending on the ups and down of that crazy market doesn't absolutely affect neither of you.
It only concerns those who are into actually trading them (payment processors, exchange platforms, traders that inversts into them, etc.)
It's still useful as a payment system over internet, and unlike old-school internet payment, there isn't a single or a few company that act as central chokepoint (unlike Visa, MasterCard, Paypal), in theory there isn't a central Bitcoin Inc. (though in practice, some mining pools are dangerously close to be able to achieve that).
It's a bit similar to what systems like SEPA/IBAN have achieved between banks (and the various system that rely on that, like the swiss Twint) : as long as both endpoint follow the same protocol, you're free to choose any endpoint of your liking, and so do the merchant. (You don't need to both be registered at paypal, or both use MasterCard).
"Sufficiently advanced satire is indistinguishable from reality." - [Tips: 1DrYakQDKCQ6y52z6QbnkxHXAocMZJE61o ]