Just a reminder of how "wrong" I've been for 18 months:


Doesn't look like perpetual deflation. Doesn't look like a crazy horse. Doesn't look like a speculators' den. Doesn't look like a nerve-wrecker with each single transaction. No, It's a perfectly sensible stable currency with a promising future.

now there is two. i also seen it before.
and its likely that the price will fall in a correction... i happed before, after a big rise.
i sold mine at $10.

Having the underwater cables cut vs. overcoming the problems that caused other digital currencies to fail are two different things.

Not doing anything about these weaknesses and letting them go is what makes projects like this fail.

If bitcoin did not have to pay for it's electricity, it would have a major advantage over previous digital currencies. The sun, wind, and water flowing, would be running it. Not oil secured through war and shipped back or some other finite controllable resource like natural gas or coal.

It's a strategic separation.

Bitcoin's value rests on the whole underlying system of dollars, which it seeks to replace, to function, in order for it to pay for its electricity.

If I have cancer in the states, I'll go broke. If I have cancer in Spain... I won't pay a dime for the best treatment. And we pay a minor percetage for our health care than people working in USA.

We pay less, we get more. Socialized health care is more efficient (for the people, not for corportations) than privatized health care.

The first part was EPIC! It's the greatest metaphor to the way we live.

You people are fools if you think the banks and the power behind the money are just going to let something like that happen.   That of course meaning bitcoin making them obsolete.   You think they got where they are today because they are stupid?  You think the great crash and bailouts was an *accident?*

This argument has traction only if racing to solve useless hard problems ("waste") is shown to be essential in securing distributed currencies.

While I won't deny for a second that 'Satoshi' had a deep insight, his method is not by any means the only way to achieve Byzantine fault tolerance for the coin database. The literature contains extensive proofs for algorithms that can withstand up to one third traitor nodes without use of PKI, and unlimited traitors with PKI. These algorithms might not be practical from a communication overhead stand-point, but they don't lead to a wasteful arms race.
The second claim for the need of waste is to provide artificial scarcity. It's easy to envision a system where scarcity is generated by a central bank which digital signs monetary tokens; the challenge would then be to either distribute such a system in the absence of a central bank, again with Byzantine agreement on the number of minted tokens and their initial owners.

As it is, the waste should be accepted as a challenge of the current Bitcoin implementation, not embraced as the only imaginable solution.


3 hundred thousand tons of steel ?! For a toy internet currency that, aside from being a vehicle of speculation/investment, is only accepted by a few hundred tiny sites ?
Maybe some scale is required. A phrase from 'Satoshi' in the initial version of the FAQ:


Let's assume Bitcoin becomes hugely successful and manages to displace the US dollar tomorrow. The total quantity of dollars that make up the monetary base (the most liquid money that bitcoin would replace) is on the order of 2 trillion, so if their value is substituted with  bitcoins, the 12 million bitcoins generated in the next 10 years (6 million -> 18 million) will be worth today about 1.3 trillion $. If we equate that value with the price of electricity as per the quote above we get 26 trillion KWh at current wholesale prices. That's more than the entire energy production of the world in a single year ! During the ten year period, minting bitcoins would require 70% of the electricity production of the United States !

While I agree Bitcoin will not replace the dollar, and it will certainly not do so tomorrow, using the correct scale shows just how bad a design is. A smaller Bitcoin is not less bad, just bad on a smaller scale, a local toxic spill as opposed to a full blown Exxon Valdez.

Mind you, I have ignored the hardware requirements which will likely dominate mining and that have more important impacts on the environment than the electricity consumption. In a real scenario, the electricity consumption will be lower, while the environmental impacts will be higher (manufacturing is more damaging than electricity production for a given revenue level; electricity can come from nuclear, hydro, etc. while copper can't be extracted without carving up some mountain).
I challenge anyone to reflect on how all this compares with the current financial sector, and prove how Bitcoin can be seen as an improvement.

There's also the issue that the EFF will probably be defending Bitcoin in the near future.
Possessing an income stream in Bitcoin would be a bit of a conflict of interest.

No, it's just local ones. There's no way to get all network-wide orphan blocks. Some might only spread to a few dozen peers.

I was just discussing with a friend the idea of a Bitcoin bank that existed solely in cipherspace. In order to establish trust and hedge against risk, the bank could create an account accessible by some majority of investors in case of fraud, theft, or data loss. Perhaps this could be done with a multi-signed transaction?

It seems like OpenTransactions provides the perfect toolset to do this on top of Bitcoin. I'm pretty sure I've seen discussion on ways for some entity to prove that it is holding full reserves.

Muslim elders/scholars/lawyers could declare that bitcoin is in compliance with Islamic law, unlike trashy heathen fiat fun-bux.

Also, Hugo Chavez might decree bitcoins be the new People's Currency, and only sell oil to the Imperial swine for them.