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  1. #1
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    Default Bitcoin energy use in Iceland set to overtake homes, says local firm

    Is this a good thing globally?

    http://www.bbc.co.uk/news/technology-43030677

  2. #2
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    No, it is not. Not a good thing at all. Although things like this will greatly accelerate government regulation of cryptocurrency. Whether that is good or bad depends on your perspective.

    I do know for certain, though, that governments are NOT going to continue allowing unlimited free exchange/trading of cryptocurrencies when they are getting zero tax revenue for it...

    "Cryptocurrency mining requires almost no staff, very little in capital investments, and mostly leaves no taxes either.
    ...
    The value to Iceland... is virtually zero."
    Last edited by JasonJoel; 02-13-2018 at 07:00 AM.

  3. #3
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    Much of my problem in figuring this stuff out is my almost complete lack of comprehension over the general economic value of crypto money. I can’t decide if it’s an investment scheme or like printing money who’s value exceeds the assets of the issuer or what. Since the value of crypto money rises and falls under market pressures just like traditional currency, what are the economic advantages? I’m lost.

    It does seem to me that there has to be some clear societal benefit to justify the juice it takes to run the thing. But I could be wrong.

  4. #4
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    It is just about the money. No tangible societal benefit, in my opinion.

    There is value in cryptocurrency because people decided there is - simple as that. No different than gold or any other object in that regard.

    One of the things that is unique to cryptocurrency, though, is that one significant security issue or fundamental algorithm problem can make the value go (literally) to zero instantaneously. And that is really dangerous for a currency.

    Any currency not tied to a physical asset (which are most currencies these days) are only as good as the faith people put into it. When you are talking about governments that move slowly and don't typically implode overnight, that is a fairly stable entity to garner faith in - thus creating value in the currency.

    An algorithm - not so much.

    I expect one of the many cryptocurrencies will have a major/catastrophic algorithm or security failure before long, and then cause massive devaluation in all cryptocurrencies - maybe just short term, but possibly long term.
    Last edited by JasonJoel; 02-13-2018 at 08:50 AM.

  5. #5
    Untangle Ninja sky-knight's Avatar
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    I'm not sold on Cryptocurrency, but I am quite sold on blockchain...

    As for why Iceland is going through this, it's a simple matter of ROI.

    If some cryptocoin is worth $X today, and you assume it's going to be worth $X+Y in two years, then you can spend $X-$Y on stuff to hopefully keep the difference. Right?

    Well a HUGE part of that calculation is power costs, but half of that isn't the power consumed by all those GPUs / ASIC rigs, it's the cooling costs. In a place like Iceland you can just open the window or use fans to naturally aspirate the space and keep things running really inexpensively. If I try to mine here in AZ, I lose my shirt... power is relatively expensive, and the cooling costs in the Summer are murderous. Sadly this concentrates computational assets for the chain into cooler areas, which is hostile to the decentralized nature of the chain. Also, mining gear doesn't just create the currency, that's a short term job, there's a finite supply. Long term that equipment is providing the infrastructure to operate the bank, regulate and maintain transactions. You can think of them all as a specialized torrent swarm setup to move money around. The amount of currency awarded for providing this service is never enough to provide a positive ROI on the equipment to provide it... that's economic doom... Which is why in the end all current crypto's will die, they arne't sustainable.

    I'll stay out of the philosophical debate over the differences between crypto currency and fiat currency, except to say that the US dollar being backed by the full faith and credit of the US government, and by extension the people governed by that government, is something very different than being based on "nothing".

    Value is indeed subjective. And thus far I've seen no crypto currency strong enough to survive being regulated as an actual currency. That's why I've stayed clear, meanwhile I'm left puzzled why my GPUs cost so much when you cannot really mine efficiently with them much anymore. Then I remember, it's subjective... and people just want to do this because they want to do it. And so, the fad marches on, and I wonder where my 10 bitcoins I mined in the early days went...
    Rob Sandling, BS:SWE, MCP
    NexgenAppliances.com
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  6. #6
    Untangle Ninja jcoehoorn's Avatar
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    I am not sold yet on blockchain, precisely because of the energy concerns here.

    IF the energy use problem can be solved, I do think cryptocurrency has a future. However, that future won't be as an everyday replacement for currencies like the dollar or euro. I think the potential for cryptocurrency is taking over the stabilizing effect gold used to have on national and international economies: controlling inflation and holding governments accountable for their wider monetary policy.
    Five time Microsoft ASP.Net MVP managing a Lenovo RD330 / E5-2420 / 16GB with Untangle 13.1 to protect 700Mbits for ~400 residential college students and associated staff and faculty

  7. #7
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    Energy consumption/production in Iceland obviously isn't the end story. And while intelligent people can debate the total power consumption of Bitcoin operations, Bitcoin isn't the only cryptocurrency player.

    And while I don't want to get into climate change debates, surely the the total cost of cooling isn't limited to the financial cost of power directly consumed by cooling systems. Was it Google or Microsoft that was experimenting with relatively low-cost cooling rigs submerged in oceans? Everybody in the press reports thought it a promising economical solution to cooling, but I didn't notice any raised press eyebrows over the amount of heat potentially being continually dumped into the water. Until somebody can show that such concerns are positively unwarranted, I would think sources of significant heat production belong in the environmental conversation.

    Anyway, the conversation about cryptocurrency itself has been interesting and enlightening. Thank you.

    EDIT: Microsoft at least was experimenting with ocean-powered cooling: https://arstechnica.com/information-...em-in-the-sea/

    EDIT2: But the idea isn't totally original: https://www.youtube.com/watch?v=VChOEvKicQQ
    Last edited by Sam Graf; 02-13-2018 at 02:59 PM.

  8. #8
    Untangle Ninja sky-knight's Avatar
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    The environmental concern isn't the heat into the water from the electronics, that's not changing atmospheric conditions just making a very minor localized increase in ocean temperatures. Sure, permanent increases in local temperature would alter the local habitat, but that can be dealt with via proper monitoring. The larger environmental concern is the carbon impact of generating all the power required to operate those farms to begin with.
    Last edited by sky-knight; 02-13-2018 at 04:13 PM.
    Rob Sandling, BS:SWE, MCP
    NexgenAppliances.com
    Phone: 866-794-8879 x201
    Email: support@nexgenappliances.com

  9. #9
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    I'm not suggesting we have a single point concern. I'm wondering about a cumulative, additive effect. The oceans are already warming.

    Healthy heat sinks dissipate, not collect heat. The oceans are vast, and that's the only reason one can be optimistic that the cumulative impact is negligible. I'd like to see the science on it, that's all.

    Or to put it another way, I'd like to see intelligent people consider whether increasing power consumption at this time by units characterized roughly by the consumption of entire nations is actually progress.
    Last edited by Sam Graf; 02-13-2018 at 04:54 PM.

  10. #10
    Untangle Ninja sky-knight's Avatar
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    That's fair, but our little blue marble is actually pretty good at radiating away waste heat. The Oceans are getting hotter as a side effect of the atmosphere holding onto that energy. That's why we're all worried about CO2 and Methane levels in the upper atmosphere. The Ring of Fire being awake and rather angry isn't helping matters.

    What also doesn't help is the inherent inaccuracies in all of this because these systems are huge, and not well understood.
    Rob Sandling, BS:SWE, MCP
    NexgenAppliances.com
    Phone: 866-794-8879 x201
    Email: support@nexgenappliances.com

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