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Bitcoin & crypto? Pt. 2

Discussions about the economic and financial ramifications of PEAK OIL

Re: New internet currency Bitcoin grows in popularity

Unread postby careinke » Sat 20 Jun 2015, 05:22:16

Strummer wrote:
careinke wrote:1. There is only a finite amount of a crypto currency and the amount is known.


Yeah, except it takes about 10 seconds to create a brand-new cryptocurrency from a template.


Your point?

Are you saying every time a new cryptocurrency is put out, everyone will have to switch over?

Although your statement is correct, I don't see it as a problem.
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Re: New internet currency Bitcoin grows in popularity

Unread postby Strummer » Sat 20 Jun 2015, 05:40:08

careinke wrote:
Strummer wrote:
careinke wrote:1. There is only a finite amount of a crypto currency and the amount is known.


Yeah, except it takes about 10 seconds to create a brand-new cryptocurrency from a template.


Your point?


The point is that the statement about the "finite amount" is plainly wrong, becaus there's absolutely nothing tha would prevent any or all market participants form switching to any other currency (of which there is an infinite amount) at any point it suits them.
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Re: New internet currency Bitcoin grows in popularity

Unread postby Outcast_Searcher » Sun 21 Jun 2015, 13:35:27

Strummer wrote:
careinke wrote:
Strummer wrote:
careinke wrote:1. There is only a finite amount of a crypto currency and the amount is known.


Yeah, except it takes about 10 seconds to create a brand-new cryptocurrency from a template.


Your point?


The point is that the statement about the "finite amount" is plainly wrong, becaus there's absolutely nothing tha would prevent any or all market participants form switching to any other currency (of which there is an infinite amount) at any point it suits them.

Right. And that's what makes crypto-currencies fundamentally no different than paper currencies (as opposed to say, gold or silver). There is nothing to limit politicians from abusing them and making them fiat (as a group), once countries/governments get into the act.

And until governments endorse them, the murkiness as to what the rules (i.e. regulations, legality) etc. will be make the risk of holding traditional fiat currencies look like a family picnic.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: New internet currency Bitcoin grows in popularity

Unread postby careinke » Mon 22 Jun 2015, 12:39:05

Crypto currency IS a fiat currency.

The point of cryptocurrency is to decentralize banking not centralize it. You don't need govt approval to use it, create it or control it. That is just propaganda brainwashed into you by the powers that be. Until you understand that basic concept, you might as well go back to polishing your chains.

There are already at least five cryptocurrencies out there right now. Adding more is the equivalent of adding another brand of cereal to the store shelves, it does not necessarily mean the new cereal is going to replace all the other cereals out there. Heck, if you count all currencies there are hundreds out there. So the argument that the creation of a currency will automatically make other currencies worthless, is a straw man.

The US dollar is designed to continually lose value (and it does a great job of it). Probably not a good vehicle to store your wealth in.
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Re: New internet currency Bitcoin grows in popularity

Unread postby dinopello » Thu 01 Oct 2015, 09:21:40

My neighborhood is getting its first Bitcoin ATM

I didn't even realize Bitcoin was still a thing. Unlike a traditional ATM that give you cash it sounds like this one you put the cash in. Brilliant!

The Bitcoin ATM helps consumers buy Bitcoin using cash. Once the consumer deposits cash, the machine can either print out a paper wallet or scan your existing digital wallet on your cell phone to transfer the Bitcoin.
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Re: New internet currency Bitcoin grows in popularity

Unread postby careinke » Sun 21 May 2017, 02:51:13

Check out the prices of both Bitcoin and Ethereum over the last couple of months. Even Bill gates is using Ethereum.

https://www.coinbase.com/charts

It may be a fad, (Not), but I'm making money on it.
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Bitcoin uses far too much energy

Unread postby KaiserJeep » Wed 10 Jan 2018, 05:03:03

The Ridiculous Amount of Energy It Takes to Run Bitcoin
Running Bitcoin uses a small city’s worth of electricity. Intel and others want to make a more sustainable blockchain.


Bitcoin “miners” are electromagnetic alchemists, effectively turning megawatt-hours of electricity into the world’s fastest-growing currency. Their intensive computational activity cryptographically secures the virtual currency, approves transactions, and, in the process, creates new bitcoins for the miners, as payment.

And it does another thing, too: It uses an absolutely stunning amount of power. The ever-expanding racks of processors used by miners already consume as much electricity as a small city. It’s a problem that experts say is bad and getting worse.


Original article is at: https://spectrum.ieee.org/energy/policy/the-ridiculous-amount-of-energy-it-takes-to-run-bitcoin

The problem with bitcoin and online currencies in general: They evaporate with the web. If you believe (as I do) that the last two survivors of the human race will be networked to one another, then this is a good idea.

If you believe the web and the power grid are toast, online currencies are no good. Nor is gold IMHO. I might trade you some homegrown food for some really fine wines or liquors, but you can't eat gold coins.
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Re: Bitcoin uses far too much energy

Unread postby GoghGoner » Wed 10 Jan 2018, 10:04:44

First time I read about Bitcoin's energy use, I had the same thought. So ridiculous.
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Re: Bitcoin uses far too much energy

Unread postby Tanada » Wed 10 Jan 2018, 10:47:18

KaiserJeep, if the grid goes down the bulk of "paper" currency goes with it too. You know from your professional experience that on the order of 95% of all "money" is not physical paper, it is simply entries in electronic book keeping systems. Even if it only goes down for a week the lost trading volume would be economical disastrous and we would have to reset our system to use something else as an acceptable alternative. Perhaps we would end up with everyone having a smartcard that remembers all your exact balances in all accounts and updates every time you use it dispersing the information so it is survivable. One thing I am fairly certain about, humans dither until a crisis and then try and smart or fight their way out.
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Re: Bitcoin uses far too much energy

Unread postby GHung » Wed 10 Jan 2018, 11:42:15

One Bitcoin Transaction Now Uses as Much Energy as Your House in a Week
Bitcoin’s surge in price has sent its electricity consumption soaring.

.......
It's impossible to know exactly how much electricity the Bitcoin network uses. But we can run a quick calculation of the minimum energy Bitcoin could be using, assuming that all miners are running the most efficient hardware with no efficiency losses due to waste heat. To do this, we'll use a simple methodology laid out in previous coverage on Motherboard. This would give us a constant total mining draw of just over one gigawatt.

That means that, at a minimum, worldwide Bitcoin mining could power the daily needs of 821,940 average American homes.

Put another way, global Bitcoin mining represents a minimum of 77KWh of energy consumed per Bitcoin transaction. Even as an unrealistic lower boundary, this figure is high: As senior economist Teunis Brosens from Dutch bank ING wrote, it's enough to power his own home in the Netherlands for nearly two weeks.

Digiconomist's less optimistic estimate for per-transaction energy costs now sits at around 215 KWh of electricity. That's more than enough to fill two Tesla batteries, run an efficient fridge/freezer for a full year, or boil 1872 litres of water in a kettle.

https://motherboard.vice.com/en_us/arti ... ate-change
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Re: Bitcoin uses far too much energy

Unread postby onlooker » Wed 10 Jan 2018, 11:50:23

Given its bubble like rise and the excessive energy use, one has to conclude that Bitcoin is a boondoggle
Now I am not sure one can characterize all Cryptocurrencies as such
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Re: Bitcoin uses far too much energy

Unread postby KaiserJeep » Wed 10 Jan 2018, 12:06:01

Tanada, I know and I was alluding to the epheremal nature of electronic currencies in general, you clarified it nicely. I would make the further point that they are all of them useless if we don't have an ever-present network to support online trade.

Once reduced to barter, I'm no longer interested in trading my food and liquors and spices and herbs for anything else, including printed pieces of paper with pictures of dead presidents on them, or little disks of precious metals with images stamped on them. So physical currencies also lose value, because due to the understanding of the true nature of money brought about by online commerce, we all of us understand all too well what used to be termed "fiat currency". It's another side effect of an electronic network, this new understanding of the nature of money.

Now let me share with you the sure and certain reason why this is a problem we Middle Class folks don't need to worry about. That would be the much-maligned 1%. Because you see they have SO MUCH MORE TO LOSE than do you or I.

I'm not confining my observations to Bitcoin, in case that was not clear already. We already have virtual currency and credit and even virtual securities. Every time you use a credit card, a debit card, make an online purchase, or an online trade in a stock or commodities exchange, you are using digital currency. The fact that we choose to keep score in US dollars in most places is why the rest of the World hates the USA. That's also the true nature of Bitcoin - a new digital currency, more resistent to counterfeiting, that is appreciating due to unfounded speculation. Believe me, I made a career out of building trusted hardware to keep track of virtual money, and "bits is just bits".

The basic elements of life are the only things that have true value. Food, clean water, and clean air. Warmth and a place to rest comfortably. The presence of friends, either physical or virtual, and preferably BOTH physical and virtual.

What brought about this revelation was the death of a "friend", or perhaps "slave" would be a better term. Our 14-year-old, well-used, and comfortably familiar refrigerator-freezer died yesterday, and took a couple of hundred dollars in fresh food with it. We lost the contents of the refrigerator section, and the stuff in the freezer went to about -10 degrees F, because a little motor that operated a flapper door seperating the two sections died, and the cold air was confined to the freezer only. So today we have the surviving chilled items, mostly pickles, condiments, and carbonated drinks, in a Coleman cooler while we rotate blue ice packs through the over-performing freezer.

The small replacement assembly is not available online or at local appliance suppliers. So we are shopping for a new unit that will cost at least $1000 in 2018 fiat currency - but they will get our business only if they deliver and carry off the appliance "corpse". We are also restricted in what we buy by the fact that in our 10-year-old kitchen remodel, we wrapped custom cherry cabinetry around the existing appliance. So now we are shopping for something in a stainless finish to match the other appliances, and within an inch or two of the same height and width as the old unit.

Call it a reminder of the nature of our economy and the value of currencies.
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Re: Bitcoin uses far too much energy

Unread postby onlooker » Wed 10 Jan 2018, 12:36:57

I think the era of excess energy made possible by fossil fuels has conjured up all sorts of extravagant, superfluous and frivolous activities and traditions. Being born and living within this era makes it difficult for us to truly appreciate this reality. But I could not agree more that what matters really are the tangible and physical basic necessities of life.
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Re: Bitcoin uses far too much energy

Unread postby KaiserJeep » Wed 10 Jan 2018, 13:11:27

I used to devour museums with gusto. Now I indulge occasionally, but not to any great extent. The Smithsonian was my idea of a Museum. History, Technology, Natural History, and Science/Industry. Art Museums, not so much.

"Curator" strikes me as an invention to employ a useless academic drone, to be frank about the topic. I'd rather read a little plaque written by a true expert than be "curated" by someone of lesser talents.

As for Andy Warhol, I saw some of his work in NYC many years ago when he was still alive. He probably laughed all the way to the bank, as did Swartzeneggar after making those "Conan" movies, before he was even fluid in English.
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Re: Bitcoin uses far too much energy

Unread postby KaiserJeep » Wed 10 Jan 2018, 13:35:56

I'll see you LEEDS certification, and raise you to PassivHaus.

I need to make a lot of changes to my Nantucket home-in-the-forest, before it's energy efficient - and it'll never be a prime example of such, although the two additional structures we can build on the same property could be.

The good news is it only uses about 17 gallons of oil a season in it's current occupancy of 2-4 weeks/year, with the thermostat set at 50 degrees when empty. I really have no idea what the costs will be for year-round occupancy.

Hopefully, a couple of years to plan and make changes. Then build a Summer place on Lake Michigan.
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Re: Bitcoin uses far too much energy

Unread postby Outcast_Searcher » Wed 10 Jan 2018, 14:49:42

Tanada wrote:KaiserJeep, if the grid goes down the bulk of "paper" currency goes with it too. You know from your professional experience that on the order of 95% of all "money" is not physical paper, it is simply entries in electronic book keeping systems.

Another benefit of solar panels rolling out over time. Do the Walmarts with the massive roof solar arrays go dark if the grid goes down for an hour or three? (I don't know, just asking).

I know some stores like Home Depot have generator backups and if the grid is down awhile, the store can stay open, the cash registers run, and some of the lights are still on. One of the few times I was pleasantly surprised at the service at Home Depot was when this happened in my home town last summer.

I agree that a huge proportion of the currency and transactions is digital. I'm just figuring that as the grid gets more distributed as green energy sources roll out, this will less and less of a big deal, especially in the short term.

Already today, everyone with a smart phone who wants to can still shop online (up to the capacity of the cell towers) for hours if the grid goes down locally or regionally. Same story for home banking.

...

Now, dealing with Bitcoin mining, etc. which takes pretty massive power, that is likely a completely different kettle of fish, at least in the vast majority of cases.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: Bitcoin uses far too much energy

Unread postby GHung » Wed 10 Jan 2018, 16:14:45

When the first quantum computer comes online, bitcoin will go POOF.

Breaking Bitcoin With a Quantum Computer

Alex Beath, a Toronto-based physicist and pension fund analyst, is skeptical about Bitcoin but sees one useful purpose for the crypto-currency: It may detect when someone creates a working quantum computer.

“The second someone creates a viable quantum computer, the NP-complete math problems at the heart of Bitcoin mining tech become instantly solvable,” Beath notes. “In other words, one answer to the question ‘what’s the first thing you’d do with a quantum computer?’ is ‘mine all of the remaining Bitcoin instantly.’ Until that happens, nobody has a quantum computer.”

Beath’s off-the-cuff observation, which he made in response to a Fortune query about the security of bitcoin, is amusing. But it also underscores a serious problem: Namely, a new era of computing is fast-approaching and when it arrives, the system that gave rise to many crypto-currency fortunes will collapse.

This threat to Bitcoin and other software systems that use the same underlying encryption technique—a technique likely to crumble in the face of a quantum-based attack—is not new. Indeed, it was predicted decades ago, and Ethereum founder (and former journalist) Vitalik Buterin wrote about how to defend it in 2013.

The difference today, though, is that companies like Microsoft, Google and IBM are making rapid breakthroughs that could make quantum computing viable in less than 10 years......

http://fortune.com/2018/01/06/breaking- ... rsaturday/

What will all of that freed-up electricity do to energy markets? Maybe those miners will go back to playing games.
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