Bitcoin isn't green

Etlase2

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Re: Bitcoin isn't green

April 17, 2012, 09:16:01 PM

#41

Quote from: benjamindees on April 17, 2012, 06:28:35 PM

But it actually gets much better. Because the current Bitcoin market cap could grow by a factor of 100 with only, at most, a doubling or tripling of energy consumption. That would make it a 4.3 billion dollar market cap supported on less than $45,000 per day.

I don't follow this logic. If the market cap grows by 100, all other things being equal (very unlikely), the price per coin will multiply by 100. Only 2 or 3x people will start mining and everyone else will leave the 33-50x profit to miners?

Decrits

MoonShadow

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Re: Bitcoin isn't green

April 17, 2012, 09:29:22 PM

#42

Quote from: Etlase2 on April 17, 2012, 09:16:01 PM

Quote from: benjamindees on April 17, 2012, 06:28:35 PM

But it actually gets much better. Because the current Bitcoin market cap could grow by a factor of 100 with only, at most, a doubling or tripling of energy consumption. That would make it a 4.3 billion dollar market cap supported on less than $45,000 per day.

I don't follow this logic. If the market cap grows by 100, all other things being equal (very unlikely), the price per coin will multiply by 100. Only 2 or 3x people will start mining and everyone else will leave the 33-50x profit to miners?

You answered your own (implied) question. Bitcoin has a potential velocity rate several orders of magnitude faster than what is possible or common with fiat currencies today. Increases in velocity tends to suppress the market trade value of bitcoin.

"The powers of financial capitalism had another far-reaching aim, nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole. This system was to be controlled in a feudalist fashion by the central banks of the world acting in concert, by secret agreements arrived at in frequent meetings and conferences. The apex of the systems was to be the Bank for International Settlements in Basel, Switzerland, a private bank owned and controlled by the world's central banks which were themselves private corporations. Each central bank...sought to dominate its government by its ability to control Treasury loans, to manipulate foreign exchanges, to influence the level of economic activity in the country, and to influence cooperative politicians by subsequent economic rewards in the business world."

- Carroll Quigley, CFR member, mentor to Bill Clinton, from 'Tragedy And Hope'

benjamindees

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Re: Bitcoin isn't green

April 17, 2012, 11:15:39 PM

#43

Quote from: Etlase2 on April 17, 2012, 09:16:01 PM

I don't follow this logic. If the market cap grows by 100, all other things being equal (very unlikely), the price per coin will multiply by 100. Only 2 or 3x people will start mining and everyone else will leave the 33-50x profit to miners?

Four things. One, the block reward halving will make mining more competitive. Two, there are only 8 million out of 21 million Bitcoins mined so far. Three, newer mining technologies will produce a 10-20x reduction in power usage per hash. And finally, eventually the price of Bitcoin in dollars won't be particularly relevant anyways, assuming things go well.