Many believe it is important for a coin to be GPU mineable so that we can have the decentralization that blockchain theory assumes.
The problem with that idea is that it doesn't account for wide scale botnet mining. The Bitcoin situation will improve, as we get to the state of the art ASIC, and incremental improvements in ASICs will slow down. This should give other people a chance to catch up.
It would be far simpler, in a technical sense not a political sense, for bitcoin to change its algorithm to an ASIC resistant one, as other coins are implemented with. There is nothing in blockchain theory that requires one particular algorithm. The early bitcoin devs just made a counterproductive choice, its software, that can be fixed.
You would think that the computation power needed for mining would be more profitable if it were used for password cracking.
For bitcoins it is not, for other coins it is. Bitcoin mining requires Application Specific hardware (ASIC). We are many years past the point where CPUs or GPUs could mine bitcoin. Other coins are still CPU/GPU mineable. Many believe it is important for a coin to be GPU mineable so that we can have the decentralization that blockchain theory assumes. Bitcoin no longer has such decentralization and is vulnerable, for example 70-80% of the mining power is located in a single country that is not known for a hands off approach to economics and finance.
"Clean energy surplus" is a simple concept, it simply means generation exceeds demand.
You can meet any demand you have for clean energy by buying as many solar cells and batteries as you like.
Really, there is some magical warehouse somewhere with millions of panels? China, with all its panel manufacturing capacity and inventory is still also using fossil fuel for electricity generation. Someday we will get there, but today, in reality we are not there yet. Hence there is no clean energy surplus to mine bitcoins on. "Why" is irrelevant. Reality is what it is and bitcoin mining is wasteful today. Hence the interest in switching from proof-or-work to proof-of-stake for digital currencies.
Yes, and your "exact answer" is bullshit because the concept of a "clean energy surplus" is bullshit. Read my previous responses for why that concept is bullshit.
You are mistaken. (1) Electricity is not fungible on a global scale like fossil fuels, it is a local resource not a global resource due to transmission capabilities. (2) "Clean energy surplus" is a simple concept, it simply means generation exceeds demand. And even in the regions most aggressively pursuing renewable they are far from that point.
Bitcoin is simply a red herring people like you bring up to cover up the fact that "clean energy" cannot meet the energy demands of modern societies, period.
I did not bring up bitcoin as a contributor to the energy deficit. But to indulge this point you keep bringing up, given that we currently have a deficit, wouldn't make the deficit worse at the moment? Sure this could change as regions move to surplus, but we are not there. That is an inconvenient true not a red herring. It could also change if bitcoin moves from proof-of-work to proof-of-stake, as etherium is planning to do.
No you do not, because you falsely assume I am blaming bitcoin for the power shortage. I am pointing out the bitcoin would require a clean energy surplus, and I am pointing out that a region that is aggressively pursuing clean energy has no such surplus. Other regions that are less aggressive are also far behind.
You asked why exactly can't Bitcoin miners and networks run on clean energy?
I gave you an exact answer, because there is no surplus.
I believe NASDAQ plans on introducing trading on Bitcoin futures in the first half of 2018. That's assuming that Bitcoin doesn't crash and burn before then.
The crash is not scheduled until after the put options are in place.:-)
Germans pay about $0.38/kWh. At those prices, you can't make a profit. So, Bitcoin and European coal is a red herring, trying to distract from Europe's generally broken energy policy.
There is no red herring, you misunderstood the point of coal being mentioned. You asked why Bitcoin can't run on clean energy. I pointed out that there would need to be a surplus of clean energy. I then offered evidence that there is such a shortage of clean energy that coal use has increased.
And why exactly can't Bitcoin miners and networks run on clean energy?
There is not a surplus of clean energy to allocate to bitcoin. Note that as Europe shut down nuclear power plants they have had to increase their usage of coal despite their massive investment in renewables. Last year coal exports from the US to Europe doubled.
To be clear, while bitcoin has many design flaws and problems and may very well be displaced by a different digital currency in the not so distant future, the blockchain is likely here to stay. But the blockchain and bitcoin are two very different things. Bitcoin is nothing more than one user of blockchain technology, blockchain technology could care less about bitcoin or any particular cryptocurrency.
If it creates a worldwide non-government controlled currency, it will be worth the struggle. A day when no government can create or destroy money is a win for the world.
Its not really on a path to do so. Yes it was designed to do so but designs often lose to reality. The reality of bitcoin is that we do NOT have decentralized mining.
In 2014 a mining pool reached 50% of the hashrate, IF they made it to 51% and had bad intentions there could have been a successful attack on the blockchain.
Today Chinese mining pools control 70% of all the hashrate, that seems vulnerable to the wishes of a single government.
Bitcoin was designed so that individuals and their computers did the mining. Instead we have mining performed by exotic and expensive ASIC hardware that it under the control of only a few. Even when individuals "own" the hardware they often have it colocated somewhere where there are inexpensive fees and low cost electricity. Their bitcoin mining rig is not really under their control and may be in a different country.
Bitcoin is a user of blockchain, just as the Ford Model T was a user of the internal combustion engine. Which is still with us, the ICE or model T?
Ford is still with us because when the Model T got outdated, they released new models. Or do you think that when Bitcoin's time is over, the entire market will just evaporate?
Ford is like the development team behind bitcoin. The big talent on the team will move from the old model to the new model, whether its car or coin.
But that is something separate from the notion of "bubble". I only mentioned the 2013 price crash from $1,000'ish to $250'ish. A recently Ars Technica article mentions four rapid exponential rises over bitcoin's history with crashes of 80%. That's the sort of thing people are talking about with respect to bubbles. And definitely something there is a danger of for the near future.
> Actually it already has been seized. Seize a wallet and the coins are seized. The FBI seized 40% (?) of the bitcoin wallets at the Russian exchange BTC-e.
The keys in a personal wallet, on a cellphone for example. are encrypted with a PIN/passhphrase and can be backed up. So even if someone loses the phone, s/he can restore the keys on a different device.
Hence the 60% not seized, but the point remains coins were seized via the wallet. Coins are also lost accidentally due to the loss of a wallet. We all know how good the average user is with their backups, and their PINs and passwords for that matter. Also when the government wants your coins they will likely get a warrant for all your computers, phones, backups, etc.
Let me help you with your understanding: Blockchain is the disruptive technology, not bitcoin.
Right and they're not related in any way...
Bitcoin is a user of blockchain, just as the Ford Model T was a user of the internal combustion engine. Which is still with us, the ICE or model T?
Stop applying outdated models to new things and it might make more sense.
I am applying cryptocurrency pricing of the last few years, bitcoin 2013 $1,000, bitcoin 2015 $250-$300.
Right. So cherry picking specific examples to suit your case.
So its cherry picking to cite, during the 2nd rapid exponential rise in bitcoin price, the first rapid exponential rise in bitcoin price. That's an interesting opinion.
Let me quote Warren Buffet at you if you need old wise man logic: "markets swing wildly from day to day on the smallest of news, rally, and crash on sentiment, and celebrate or vilify the most inane data points..."
Note that Warren used the term "days". After bitcoin's spike to $1,000 it spent about 11 months in that $250-300 range. That is not the day-to-day volatility Warren spoke of.
Don't get caught up in the fluff, block chain is a thing and it isn't going away.
Progress. You got my first point.
Bitcoin is first mover so will enjoy a huge boost from that position,...
First movers are often killed by follow on products. The followers learn from the mistakes of the first mover, bitcoin has numerous flaws and mistakes to learn from. A first mover needs a high switching cost to succeed. Bitcoin has no such barrier.
... but every crypto trader I know has a portfolio of multiple coins. Even if Ford goes bankrupt we don't all go back to riding horses.
As I have repeatedly said. Blockchain is the future, bitcoin is just a current user of the technology, its popularity largely driven not by commerce but by speculative investment. A shaky foundation, a user base with no barrier to switching to another coin. No more of a barrier than their switching from one stock to another.
What we still have is a citizen who is responsible for paying taxes [on taxable items]
and income, whether fiat or barter or bitcoin
Bitcoin/etc is definitely new, a way of storing value that can't be seized.
Actually it already has been seized. Seize a wallet and the coins are seized. The FBI seized 40% (?) of the bitcoin wallets at the Russian exchange BTC-e.
What we still have is a citizen who is responsible for paying taxes and a government that is constitutionally authorized to collect taxes. Since cryptocurrency has been determined to be an asset by the IRS its use seems to fall under the regulations regarding "bartering income". Sorry, cryptocurrency is not really anything new in this sense.
Don't be so ready to play with them. They will likely say you owe taxes on the unsold coins if they are mining proceeds. You received an asset (virtual coins) of value for a service (mining) you provided, they are likely to call that unreported income, "bartering income" is taxable. I believe the tax liability occurs when you receive the coins, not when you spend them. But I am not a tax accountant so I am unqualified to offer a legal opinion on the matter.
Coinbase does not know if the incoming coins are from mining proceeds, a payment for goods/services or a transfer from another wallet owned by the same individual.
The court order is necessary because coinbase told customers it would respect their privacy. They are not a bank, not a brokerage, the IRS has ruled that bitcoin is an asset. Coinbase is under no more regulations to report than a website trading Magic The Gathering cards.
Trailer hitch & towable generator should solve the problem
Sounds pretty inefficient. Better to go with a "long-range" hybrid like a Volt.
How is that not like a hybrid, an EV carrying an ICE along? The ICE is just externally towed rather than internally mounted. Sure backing up and parking is less convenient but inefficient hasn't been demonstrated.:-)
It's the IRS, lol. Those miners about to be taxed, hope they didn't spend it all - they might need some of it + penalties.
Unless they:
- Recorded the closing bitcoin price on the day they received mining proceeds. (basis)
- Recorded the sale price of the bitcoins on the day(s) they sold them. (gain/loss)
- Recorded the power consumed during mining those coins and kept their power bill. (variable cost)
- Kept receipts for the mining hardware and the watt meter. (fixed costs)
- Reported the basis, gain/loss and expenses (costs) on their taxes.
If they did this they might not have any problems.:-)
Actually it is an extremely appropriate thing to point out. You think it normal for the value of an investment to go exponential is an extremely short period of time? Last time bitcoin made such a move to $1,000 it dropped to $250 in 6 months. Those who were more cautious and mistrusted that exponential rise were able to buy bitcoins at 1/4 of the price of the true believers who thought the world had suddenly seen the light. It is unlikely $10,000 is the new normal, it is far more likely there will be a significant price drop. That $250-$300 plateau that followed the $1,000 spike lasted years. Spikes like the $1,000 and $10,000 moves are not safe entry points. Hence the "bubble" talk.
Slashdot Mirror
Many believe it is important for a coin to be GPU mineable so that we can have the decentralization that blockchain theory assumes.
The problem with that idea is that it doesn't account for wide scale botnet mining. The Bitcoin situation will improve, as we get to the state of the art ASIC, and incremental improvements in ASICs will slow down. This should give other people a chance to catch up.
It would be far simpler, in a technical sense not a political sense, for bitcoin to change its algorithm to an ASIC resistant one, as other coins are implemented with. There is nothing in blockchain theory that requires one particular algorithm. The early bitcoin devs just made a counterproductive choice, its software, that can be fixed.
This is why a non-'anonymous' centralized system is desirable.
Nope. The forgotten passwords are a Good Thing, because each lost btc means mine are worth more.
You assume people will still want bitcoins at that point. :-)
How long until Bitcoin bubble crashes?
The crash is not scheduled until after bitcoin futures trading is implemented in the first half of 2018 and the put options are in place. :-)
You would think that the computation power needed for mining would be more profitable if it were used for password cracking.
For bitcoins it is not, for other coins it is. Bitcoin mining requires Application Specific hardware (ASIC). We are many years past the point where CPUs or GPUs could mine bitcoin. Other coins are still CPU/GPU mineable. Many believe it is important for a coin to be GPU mineable so that we can have the decentralization that blockchain theory assumes. Bitcoin no longer has such decentralization and is vulnerable, for example 70-80% of the mining power is located in a single country that is not known for a hands off approach to economics and finance.
"Clean energy surplus" is a simple concept, it simply means generation exceeds demand.
You can meet any demand you have for clean energy by buying as many solar cells and batteries as you like.
Really, there is some magical warehouse somewhere with millions of panels? China, with all its panel manufacturing capacity and inventory is still also using fossil fuel for electricity generation. Someday we will get there, but today, in reality we are not there yet. Hence there is no clean energy surplus to mine bitcoins on. "Why" is irrelevant. Reality is what it is and bitcoin mining is wasteful today. Hence the interest in switching from proof-or-work to proof-of-stake for digital currencies.
Yes, and your "exact answer" is bullshit because the concept of a "clean energy surplus" is bullshit. Read my previous responses for why that concept is bullshit.
You are mistaken. (1) Electricity is not fungible on a global scale like fossil fuels, it is a local resource not a global resource due to transmission capabilities. (2) "Clean energy surplus" is a simple concept, it simply means generation exceeds demand. And even in the regions most aggressively pursuing renewable they are far from that point.
Bitcoin is simply a red herring people like you bring up to cover up the fact that "clean energy" cannot meet the energy demands of modern societies, period.
I did not bring up bitcoin as a contributor to the energy deficit. But to indulge this point you keep bringing up, given that we currently have a deficit, wouldn't make the deficit worse at the moment? Sure this could change as regions move to surplus, but we are not there. That is an inconvenient true not a red herring. It could also change if bitcoin moves from proof-of-work to proof-of-stake, as etherium is planning to do.
I understood the point just fine, ...
No you do not, because you falsely assume I am blaming bitcoin for the power shortage. I am pointing out the bitcoin would require a clean energy surplus, and I am pointing out that a region that is aggressively pursuing clean energy has no such surplus. Other regions that are less aggressive are also far behind.
You asked why exactly can't Bitcoin miners and networks run on clean energy?
I gave you an exact answer, because there is no surplus.
I believe NASDAQ plans on introducing trading on Bitcoin futures in the first half of 2018. That's assuming that Bitcoin doesn't crash and burn before then.
The crash is not scheduled until after the put options are in place. :-)
Germans pay about $0.38/kWh. At those prices, you can't make a profit. So, Bitcoin and European coal is a red herring, trying to distract from Europe's generally broken energy policy.
There is no red herring, you misunderstood the point of coal being mentioned. You asked why Bitcoin can't run on clean energy. I pointed out that there would need to be a surplus of clean energy. I then offered evidence that there is such a shortage of clean energy that coal use has increased.
And why exactly can't Bitcoin miners and networks run on clean energy?
There is not a surplus of clean energy to allocate to bitcoin. Note that as Europe shut down nuclear power plants they have had to increase their usage of coal despite their massive investment in renewables. Last year coal exports from the US to Europe doubled.
To be clear, while bitcoin has many design flaws and problems and may very well be displaced by a different digital currency in the not so distant future, the blockchain is likely here to stay. But the blockchain and bitcoin are two very different things. Bitcoin is nothing more than one user of blockchain technology, blockchain technology could care less about bitcoin or any particular cryptocurrency.
If it creates a worldwide non-government controlled currency, it will be worth the struggle. A day when no government can create or destroy money is a win for the world.
Its not really on a path to do so. Yes it was designed to do so but designs often lose to reality. The reality of bitcoin is that we do NOT have decentralized mining.
In 2014 a mining pool reached 50% of the hashrate, IF they made it to 51% and had bad intentions there could have been a successful attack on the blockchain.
Today Chinese mining pools control 70% of all the hashrate, that seems vulnerable to the wishes of a single government.
Bitcoin was designed so that individuals and their computers did the mining. Instead we have mining performed by exotic and expensive ASIC hardware that it under the control of only a few. Even when individuals "own" the hardware they often have it colocated somewhere where there are inexpensive fees and low cost electricity. Their bitcoin mining rig is not really under their control and may be in a different country.
Bitcoin is a user of blockchain, just as the Ford Model T was a user of the internal combustion engine. Which is still with us, the ICE or model T?
Ford is still with us because when the Model T got outdated, they released new models. Or do you think that when Bitcoin's time is over, the entire market will just evaporate?
Ford is like the development team behind bitcoin. The big talent on the team will move from the old model to the new model, whether its car or coin.
But that is something separate from the notion of "bubble". I only mentioned the 2013 price crash from $1,000'ish to $250'ish. A recently Ars Technica article mentions four rapid exponential rises over bitcoin's history with crashes of 80%. That's the sort of thing people are talking about with respect to bubbles. And definitely something there is a danger of for the near future.
Are you talking about the same Minix that's embedded in each and every Intel CPU since almost the last decade or so?
That seems like a win for the microkernel over the monolithic. ;-)
> Actually it already has been seized. Seize a wallet and the coins are seized. The FBI seized 40% (?) of the bitcoin wallets at the Russian exchange BTC-e.
The keys in a personal wallet, on a cellphone for example. are encrypted with a PIN/passhphrase and can be backed up. So even if someone loses the phone, s/he can restore the keys on a different device.
Hence the 60% not seized, but the point remains coins were seized via the wallet. Coins are also lost accidentally due to the loss of a wallet. We all know how good the average user is with their backups, and their PINs and passwords for that matter. Also when the government wants your coins they will likely get a warrant for all your computers, phones, backups, etc.
Let me help you with your understanding: Blockchain is the disruptive technology, not bitcoin.
Right and they're not related in any way...
Bitcoin is a user of blockchain, just as the Ford Model T was a user of the internal combustion engine. Which is still with us, the ICE or model T?
Stop applying outdated models to new things and it might make more sense.
I am applying cryptocurrency pricing of the last few years, bitcoin 2013 $1,000, bitcoin 2015 $250-$300.
Right. So cherry picking specific examples to suit your case.
So its cherry picking to cite, during the 2nd rapid exponential rise in bitcoin price, the first rapid exponential rise in bitcoin price. That's an interesting opinion.
Let me quote Warren Buffet at you if you need old wise man logic: "markets swing wildly from day to day on the smallest of news, rally, and crash on sentiment, and celebrate or vilify the most inane data points..."
Note that Warren used the term "days". After bitcoin's spike to $1,000 it spent about 11 months in that $250-300 range. That is not the day-to-day volatility Warren spoke of.
Don't get caught up in the fluff, block chain is a thing and it isn't going away.
Progress. You got my first point.
Bitcoin is first mover so will enjoy a huge boost from that position, ...
First movers are often killed by follow on products. The followers learn from the mistakes of the first mover, bitcoin has numerous flaws and mistakes to learn from. A first mover needs a high switching cost to succeed. Bitcoin has no such barrier.
... but every crypto trader I know has a portfolio of multiple coins. Even if Ford goes bankrupt we don't all go back to riding horses.
As I have repeatedly said. Blockchain is the future, bitcoin is just a current user of the technology, its popularity largely driven not by commerce but by speculative investment. A shaky foundation, a user base with no barrier to switching to another coin. No more of a barrier than their switching from one stock to another.
What we still have is a citizen who is responsible for paying taxes [on taxable items]
and income, whether fiat or barter or bitcoin
Bitcoin/etc is definitely new, a way of storing value that can't be seized.
Actually it already has been seized. Seize a wallet and the coins are seized. The FBI seized 40% (?) of the bitcoin wallets at the Russian exchange BTC-e.
Only if you don't understand it. Disruptive technology is disruptive.
Let me help you with your understanding: Blockchain is the disruptive technology, not bitcoin.
Stop applying outdated models to new things and it might make more sense.
Clue: I am applying cryptocurrency pricing of the last few years, bitcoin 2014 $1,000, bitcoin 2015 $250-$300.
You don't have capital gains until you cash out or spend the coins. Right now it seems an unrealized gain on paper.
What we still have is a citizen who is responsible for paying taxes and a government that is constitutionally authorized to collect taxes. Since cryptocurrency has been determined to be an asset by the IRS its use seems to fall under the regulations regarding "bartering income". Sorry, cryptocurrency is not really anything new in this sense.
Don't be so ready to play with them. They will likely say you owe taxes on the unsold coins if they are mining proceeds. You received an asset (virtual coins) of value for a service (mining) you provided, they are likely to call that unreported income, "bartering income" is taxable. I believe the tax liability occurs when you receive the coins, not when you spend them. But I am not a tax accountant so I am unqualified to offer a legal opinion on the matter.
Coinbase does not know if the incoming coins are from mining proceeds, a payment for goods/services or a transfer from another wallet owned by the same individual.
The court order is necessary because coinbase told customers it would respect their privacy. They are not a bank, not a brokerage, the IRS has ruled that bitcoin is an asset. Coinbase is under no more regulations to report than a website trading Magic The Gathering cards.
Trailer hitch & towable generator should solve the problem
Sounds pretty inefficient. Better to go with a "long-range" hybrid like a Volt.
How is that not like a hybrid, an EV carrying an ICE along? The ICE is just externally towed rather than internally mounted. Sure backing up and parking is less convenient but inefficient hasn't been demonstrated. :-)
It's the IRS, lol. Those miners about to be taxed, hope they didn't spend it all - they might need some of it + penalties.
Unless they:
:-)
- Recorded the closing bitcoin price on the day they received mining proceeds. (basis)
- Recorded the sale price of the bitcoins on the day(s) they sold them. (gain/loss)
- Recorded the power consumed during mining those coins and kept their power bill. (variable cost)
- Kept receipts for the mining hardware and the watt meter. (fixed costs)
- Reported the basis, gain/loss and expenses (costs) on their taxes.
If they did this they might not have any problems.
screaming bubble is not a great strategy.
Actually it is an extremely appropriate thing to point out. You think it normal for the value of an investment to go exponential is an extremely short period of time? Last time bitcoin made such a move to $1,000 it dropped to $250 in 6 months. Those who were more cautious and mistrusted that exponential rise were able to buy bitcoins at 1/4 of the price of the true believers who thought the world had suddenly seen the light. It is unlikely $10,000 is the new normal, it is far more likely there will be a significant price drop. That $250-$300 plateau that followed the $1,000 spike lasted years. Spikes like the $1,000 and $10,000 moves are not safe entry points. Hence the "bubble" talk.