Currency based upon computing power?

[spiral_mind]

In this video http://www.bloomberg.com/video/bitcoin-is-start-of-brave-new-world-gelfond-says-jE1q_HF5R2y8lixcxq4iLg.html Bob Gelfond proposes the idea of a currency based on computing power. I've seen this idea thrown around before. I've even heard that Nikola Tesla proposed a currency based upon electricity.

With GPU miners becoming useless for mining quickly this could be an alternative way to 'mine' with the added bonus of the computing power actually being put to use rather than wasted. GPUs are used for many different types of computer models and a huge distributed super computer could really be worth quite a bit of money. We could even use Bitcoin to pay the miners since it would be by far the most efficient method of payment for a global distributed network.

Is anyone working on anything like this?

[acoindr]

That was an interesting video. The one thing Bob Gelfond was way off on is comparing Bitcoin to Napster. He mentioned "they" and "them" needing to find ways to comply with government regulations or possibly be squashed like Napster. What he doesn't seem to grasp is there is no "they" or "them". Bitcoin is decentralized so different people can use it different ways. Some companies may operate faithfully within the bounds of regulation and some users may not. Bitcoin itself isn't any single group, individual or company.

As for selling certificates worth computing time, that's an interesting idea but it's still based on IOUs. A certificate holder has to trust the issuer will provide the computing time as agreed.

[Stephen Gornick]

In this video http://www.bloomberg.com/video/bitcoin-is-start-of-brave-new-world-gelfond-says-jE1q_HF5R2y8lixcxq4iLg.html Bob Gelfond proposes the idea of a currency based on computing power.

The reason the Bitcoin network requires a large amount of computing power is to enable decentralization, with a proof-of-work being the tool employed.

But that computing power is for a specific purpose, ... to make it so that the decentralization is immune to corruption.   That's the only reason there is this large amount of computing power.

But the proof-of-work computation that is performed is useless for anything else.  

Now that doesn't mean the computing resources that Bitcoiners will abandon can't still have use for scientific purposes, but that has nothing to do with currency.

CoinLab was making inroads to doing this but got stuck on how distributed scientific computing is a hard problem to solve with little opportunity to monetize it.

But if someone wants a "currency" based on computing power, essentially any exchange market for computing time would be that currency.   But that's a security, not a currency.

Incidentally, Bloomberg needs to update their B-roll.  It was recorded back when Bitcoin was $64-ish.

[Stephen Gornick]

As far as Sara Eisen's question as to how to get in on the "game" (of investing in Bitcoin companies) early?

BitPay's Tony Gallippi answered that here:

By simply owning bitcoins, you can profit from the success of every bitcoin company. There’s no need to pick the winners. BTC is the investment that gives you exposure to the currency, to the payment network, and to every business building products and services on top of bitcoin.

- http://www.pymnts.com/briefing-room/PYMNTS-International/2013/02/How-Owning-Bitcoin-Is-Owning-An-ETF-On-The-Whole-Bitcoin-Space