Volatility, ain't seen nothing yet, 10K to 1M in 1 year???

[NotLambchop]

...
Actually, I would be interested to know the estimates of energy consumption in gaming versus mining.
I don't have the data, but something tells me that the former is orders of magnitude greater than the latter.

Bitcoiners' community is just a few millions in total and only a small part of it crowd-funded mining operations, including those of Asicminer, Avalon, KnC, BFL and others. Gamers, on the other hand, are in hunderds of millions worldwide if not more.

Anyways, competition is fun, it's worth the energy.

According to satoshi and common sense, the cost of mining should approach the price of the coins mined.
This year, approximately 10% of the total Bitcoin in existence has been mined.  In other words, if satoshi is correct, the total cost of maintaining Bitcoin network at the present level of security is 10% of the total market cap.
Few will argue that the lion's share of that cost is electricity.  There are online mining calculators which will give you a relatively accurate number, the only guesswork on your part would need to be the the breakdown (by brand and model, and, thus, efficiency) of the gear being used.  

Right now, Bitcoin's market cap is small enough for this to be almost inconsequential.  But if Bitcoin does succeed as the new world currency, this implies that 10% of the world's wealth will be consumed each year.  Most of it in electrical costs.  That's staggering, and supplying that much energy is likely unfeasible.  Certainly not too eco friendly


But that's all irrelevant.  We're starting off with the assumption that running a Bitcoin network is the right way to do money.  It's not.
Presupposing that blockchain must be maintained is as justified as specifying mice as the prime mover in the next space shuttle design.  Sure, it could be done by introducing some truly Goldbergian complications, but ... see where I'm going with this?

[dinofelis]

Actually, I would be interested to know the estimates of energy consumption in gaming versus mining.
I don't have the data, but something tells me that the former is orders of magnitude greater than the latter.

Bitcoiners' community is just a few millions in total and only a small part of it crowd-funded mining operations, including those of Asicminer, Avalon, KnC, BFL and others. Gamers, on the other hand, are in hunderds of millions worldwide if not more.

If I understand something of the macro economics of bitcoin, you can say that the cost of the mining is of the order of the value of the inflation (somewhat less because miners want to make a profit).  Now, the cost of mining is in part the hardware, and in part the energy.  I don't know the ratio, but let's say half-half.  

At the current inflation rate, which is 10%, the energy cost of mining per year would then be of the order of 5% of the market cap.
At a current market cap of $5 billion, the mining energy cost would then be $250 million per year.  Let's put the price of a KWhr to $0.1 (in China and USA), then we have 2.5 billion KWhr per year, which comes down (there are 8760 Hrs in a year) to an average power consumption of 300 MW.  That is still reasonable.  A third of a big power plant for bitcoin to be mined.

However, imagine that bitcoin price goes up with a factor of 10.  Then all the mining in the world would go to something like 3 GW - 3 nuclear power plants.   If bitcoin takes over the world economy, and the market cap of bitcoin becomes the world fiat market cap, we arrive at 3000 GW.  Now that's embarrassing.    That's more than the world's electricity production !

[brg444]

...
Actually, I would be interested to know the estimates of energy consumption in gaming versus mining.
I don't have the data, but something tells me that the former is orders of magnitude greater than the latter.

Bitcoiners' community is just a few millions in total and only a small part of it crowd-funded mining operations, including those of Asicminer, Avalon, KnC, BFL and others. Gamers, on the other hand, are in hunderds of millions worldwide if not more.

Anyways, competition is fun, it's worth the energy.

According to satoshi and common sense, the cost of mining should approach the price of the coins mined.
This year, approximately 10% of the total Bitcoin in existence has been mined.  In other words, if satoshi is correct, the total cost of maintaining Bitcoin network at the present level of security is 10% of the total market cap.
Few will argue that the lion's share of that cost is electricity.  There are online mining calculators which will give you a relatively accurate number, the only guesswork on your part would need to be the the breakdown (by brand and model, and, thus, efficiency) of the gear being used.  

Right now, Bitcoin's market cap is small enough for this to be almost inconsequential.  But if Bitcoin does succeed as the new world currency, this implies that 10% of the world's wealth will be consumed each year.  Most of it in electrical costs.  That's staggering, and supplying that much energy is likely unfeasible.  Certainly not too eco friendly


But that's all irrelevant.  We're starting off with the assumption that running a Bitcoin network is the right way to do money.  It's not.
Presupposing that blockchain must be maintained is as justified as specifying mice as the prime mover in the next space shuttle design.  Sure, it could be done by introducing some truly Goldbergian complications, but ... see where I'm going with this?

So creating a universal ledger is not the way to do money? Maybe you have something better to propose, troll?

[Flashman]

Yah, two sets of books, one set kept in pencil.

[brg444]

Wrong, the hoarders are the hero.

http://nakamotoinstitute.org/mempool/im-hoarding-bitcoins-and-no-you-cant-have-any/

If you make your own altcoin, and you mine it exclusively yourself, and you hoard it 100%, and you replace bitcoin by the name of your altcoin in the above argument, what changes ?

what changes is no one cares about my altcoin nor is there any demand for it.

[brg444]

Yah, two sets of books, one set kept in pencil.

 

maybe LambChop can be the universal scribe

[NotLambchop]

...
So creating a universal ledger is not the way to do money? Maybe you have something better to propose, troll?

Yes, faggot, I do.  And the whole world is already using it.
It's called money, or "fiat" as you retards have taken to calling it.
You may now return to being a spergy little faggot.

[brg444]

...
So creating a universal ledger is not the way to do money? Maybe you have something better to propose, troll?

Yes, faggot, I do.  And the whole world is already using it.
It's called money, or "fiat" as you retards have taken to calling it.
You may now return to being a spergy little faggot.

 

fantastic, the "fiat" experiment is working so well anyway, why should we bother, right troll?

[NotLambchop]

Yes.  Working great.  Unlike the Bitcoin fiasco--a "store of value" that loses half of its value in a year
Props for getting me to answer your faggotry. 

[Flashman]

https://www.youtube.com/watch?v=sZHCVyllnck

Message recieved 

[brg444]

Yes.  Working great.  Unlike the Bitcoin fiasco--a "store of value" that loses half of its value in a year
Props for getting me to answer your faggotry. 

Arbitrary timeframe is arbitrary

[NotLambchop]

As I've mentioned before, there was a time when BTCeanie BTCabies were a good investment.  That time is but a memory.
As is the case with BTCitcoin.

http://cointelegraph.com/news/112961/coinbase-brings-bitcoin-to-mozilla-itunes-unveils-bitcoin-tipping-tool

[cryptogeeknext]

...
According to satoshi and common sense, the cost of mining should approach the price of the coins mined.
This year, approximately 10% of the total Bitcoin in existence has been mined.  In other words, if satoshi is correct, the total cost of maintaining Bitcoin network at the present level of security is 10% of the total market cap.
Few will argue that the lion's share of that cost is electricity.  There are online mining calculators which will give you a relatively accurate number, the only guesswork on your part would need to be the the breakdown (by brand and model, and, thus, efficiency) of the gear being used.  

Right now, Bitcoin's market cap is small enough for this to be almost inconsequential.  But if Bitcoin does succeed as the new world currency, this implies that 10% of the world's wealth will be consumed each year.  Most of it in electrical costs.  That's staggering, and supplying that much energy is likely unfeasible.  Certainly not too eco friendly


But that's all irrelevant.  We're starting off with the assumption that running a Bitcoin network is the right way to do money.  It's not.
Presupposing that blockchain must be maintained is as justified as specifying mice as the prime mover in the next space shuttle design.  Sure, it could be done by introducing some truly Goldbergian complications, but ... see where I'm going with this?

...
If I understand something of the macro economics of bitcoin, you can say that the cost of the mining is of the order of the value of the inflation (somewhat less because miners want to make a profit).  Now, the cost of mining is in part the hardware, and in part the energy.  I don't know the ratio, but let's say half-half. 

At the current inflation rate, which is 10%, the energy cost of mining per year would then be of the order of 5% of the market cap.
At a current market cap of $5 billion, the mining energy cost would then be $250 million per year.  Let's put the price of a KWhr to $0.1 (in China and USA), then we have 2.5 billion KWhr per year, which comes down (there are 8760 Hrs in a year) to an average power consumption of 300 MW.  That is still reasonable.  A third of a big power plant for bitcoin to be mined.

However, imagine that bitcoin price goes up with a factor of 10.  Then all the mining in the world would go to something like 3 GW - 3 nuclear power plants.   If bitcoin takes over the world economy, and the market cap of bitcoin becomes the world fiat market cap, we arrive at 3000 GW.  Now that's embarrassing.    That's more than the world's electricity production !

First of all, the current 10% inflation is temporary, it will go down gradually over time.
Secondly, the amount of resources and energy spent on mining reflects the demand for competition in control for transactions.
Mining has nothing to do with market cap in the long run, adjustable difficulty reflects the demand for control.
You don't need to mine Bitcoin in order to use it, you can make profit by providing services or doing some useful work.

The beauty of PoW is that money and control are separate. They must be, as they are two different archetypes. Things you cannot buy with money, you get through control. Keeping them separate ensures the competition for both.

[Flashman]

or doing some useful work.

Probably the part that's worrying him. Don't worry, I'm sure that pretty soon after governments start to take tax payments in bitcoin, they'll start paying welfare in it also.

[NotLambchop]

...
First of all, the current 10% inflation is temporary, it will go down gradually over time.

Sure, the next reward halving would cut it in half.  Also cutting the security of the network in half by causing miners to shut down (remember--the cost of mining should approach the price of coins mined according to satoshi).  Unless Bitcoin prices happen to double on that happy day.

Secondly, the amount of resources and energy spent on mining reflects the demand for competition in control for transactions.
Mining has nothing to do with market cap in the long run, adjustable difficulty reflects the demand for control.

No, mining has everything to do with market cap, see above.  Bitcoin's market cap is simply (price of BTC) * (total BTC in existence).
Lower market cap means that each bitcoin is worth less.  Would you spend $300 to mine a coin worth substantially less than $300?
Sure mining depends on market cap.

You don't need to mine Bitcoin in order to use it, you can make profit by providing services or doing some useful work.

That's true, though not relevant to this conversation.

The beauty of PoW is that money and control are separate. They must be, as they are two different archetypes. Things you cannot buy with money, you get through control. Keeping them separate ensures the competition for both.

Not sure what you're trying to say.

[NotLambchop]

[catty snipe]

D00d going by Flashman:  Unless you have more than your snark to contribute to the conversation, learn to STFU.
ty

[brg444]

Sure, the next reward halving would cut it in half.  Also cutting the security of the network in half by causing miners to shut down (remember--the cost of mining should approach the price of coins mined according to satoshi).  Unless Bitcoin prices happen to double on that happy day.

Which is safe to assume it will because, you know... half supply.

[brg444]

[catty snipe]

D00d going by Flashman:  Unless you have more than your snark to contribute to the conversation, learn to STFU.
ty

 

the irony

[NotLambchop]

...
Which is safe to assume it will because, you know... half supply.

Yeah, I know.  Limited supply.  That's what made BTCeanie BTCabies valuable...

"The company's strategy of deliberate scarcity, producing each new design in limited quantity, restricting individual store shipments to limited numbers of each design and regularly retiring designs, created a huge secondary market for the toys and increased their popularity and value as a collectible."--wikip

...until it didn't.

There's that other variable at play here, called "demand."  The absence of it is what's tanking the price of your  BTCeanie BTCabies Bitcoin nao

[cryptogeeknext]

Secondly, the amount of resources and energy spent on mining reflects the demand for competition in control for transactions.
Mining has nothing to do with market cap in the long run, adjustable difficulty reflects the demand for control.

No, mining has everything to do with market cap, see above.  Bitcoin's market cap is simply (price of BTC) * (total BTC in existence).
Lower market cap means that each bitcoin is worth less.  Would you spend $300 to mine a coin worth substantially less than $300?
Sure mining depends on market cap.

In a balanced PoW system mining is a break-even game, it doesn't matter if 1 BTC is woth 300$ or 10k.
If you are, as Bitcoin user, satisfied with the quality of control over transactions, you don't need to mine Bitcoins.

If you want to challenge the controllers though, you might want to crowd-fund your own farm, or develop some innovation in this space. As adoption and the market cap increases, the mining market can grow to reflect the growing importance of control over the system, but it doesn't have to match it in any way.

In an extreme case a single computer with network's difficulty equal to 1 will be able to handle all of the transactions regardless of the market cap, only the amount of competition for control over the system will determine the cost of mining and future network's difficulty.