Bitcoin Using More Energy Than Argentina

Discussion in 'Taylor's Tittle-Tattle - General Banter' started by Clive_ofthe_Kremlin, Feb 12, 2021.

  1. Clive_ofthe_Kremlin

    Clive_ofthe_Kremlin Squad Player

    Apparently. Just when we need to be reducing energy consumption in order to, erm, survive as a species, this most absurd and futile power gannet is draining the grid.

    Please could the capitalist defenders here explain to me in the plain and simple language that us common folk understand, why we need to have this? Because I have to admit it looks a bit crazy to me.
     
  2. Lloyd

    Lloyd Squad Player

    I gave up trying to understand Bitcoin a long time ago - but I still write cheques so probably not the best person to ask
     
  3. Rookery Refugee

    Rookery Refugee Reservist

    It's quite simple. The Argies are actually behind it all. It's a sophisticated currency theft scheme designed to create huge British debt, which will be bought up by Argentina using this electronic currency, forcing Britain to cede the Falklands to them, along with Jeremy Clarkson's body (it's unclear whether they want it breathing or lifeless) and HMS Belfast from the Thames... which is to be renamed "ARA General Belgrano II".
     
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  4. Jumbolina

    Jumbolina First Team

    Isn't Bitcoin anti-capitalist? Taking currency away from the central banks and releasing the people!
     
  5. Moose

    Moose First Team Captain

    It’s more anti-state and libertarian isn’t it? Fundamentally, in a Bitcoin world people still own companies and other people have to work for them. It wouldn’t change that. It simply bypasses state control (until the states buy Bitcoin or rule it illegal).

    It’s attractive mostly to those with traditional mega bucks to spaff, notably like Musk. If people getting by through foodbanks in Hartlepool or Camborne are capitalism’s most evident current failure, it’s reserve army of Labour that depresses wage cost, Bitcoin is irrelevant to them. It’s greatest advocates would appear to be disrupters. If it works and they profit, then it solidifies their power which generally seeks to avoid the responsibilities of the State, though tax authorities are catching up.

    The arbitrary use of electricity like this to create no physical benefit demonstrates that it’s a bit of an antisocial monster. Mining metals to make real coins was too, but that’s going to pretty much disappear.

    However, there’s plenty about it I don’t get, including what the possibilities are if currency goes increasingly this way.
     
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  6. PotGuy

    PotGuy Forum Fetishist

    I read a book about bitcoin, but I still didn't really understand it

    That was partially because it was very boring so it I stopped reading it half way through
     
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  7. Steve Leo Beleck

    Steve Leo Beleck Squad Player

    I really don't understand the "mining" bit. Can anyone explain that in layman's terms?

    And not just by posting a link to an article as I've tried reading them and still don't get it!
     
  8. Moose

    Moose First Team Captain

    Maybe, but not necessarily in a way that makes intuitive sense as they are rules within a closed system, essentially a game.

    So bitcoin 'miners' (up there with 'influencer' or 'brexiteer' in the 21st century's lexicon of empty signifiers) do two things. First of all they audit transactions to prevent bitcoins (which are simply an electronic token) being spent more than once. That this is the responsibility of volunteers rather than a bank is somewhat radical, but that's the paradigm. Presumably it's vital for the integrity of the system and after all currencies work on confidence. You have to have confidence that your physical pound coin is real and that the bank will always credit you a pound for it. I have no idea what happens if miners come across a rum transaction, but presumably something does.

    Secondly miners guess numbers ('hashes'), 64 digit hexadecimals, or rather their computers do. By some esoteric working of Bitcoin's rules they get a reward for this. No, me neither.

    Apparently mining is now very difficult and takes a very high level of computing power.
     
  9. Steve Leo Beleck

    Steve Leo Beleck Squad Player

    Haha, thanks for trying Moose, that was about as much as I understood already. The questions I have are:

    1. How do random people on the internet verify a transaction to any degree of confidence?
    2. Why are they guessing these 64 digit numbers? And why are they rewarded for doing so?

    Whole thing is mystifying to me.
     
  10. Moose

    Moose First Team Captain

    Presumably on the basis that the transactions are audited lots of times. The guessing game bit is random, but then all games are outside of the universe of the game itself.

    But as you knew mining was about auditing you could have said and saved me the bother of looking it up. :)
     
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  11. Arakel

    Arakel First Team

    1. If you're talking about end users (i.e. you or I), you can look up specific transactions using tools like websites. If you're talking about how those contributing towards the network verify it (which is my assumption), that's more complicated.

    For that, imagine you submit a transaction request to transfer some bitcoin to another address. This is akin to conducting a wire transfer through your bank. For your bank account, the bank(s) involved handle the transaction. With Bitcoin, it's handled by the miners; they replace the banks by performing the work to verify the transaction. Blockchains are built on cryptography, so if someone attempted to maliciously modify a transaction that transaction's hash data (a unique hexadecimal number that details the contents of the transaction) would change. which would then change the hash of the data to be written to the blockchain. This means the other non-malicious nodes would come to different solutions and the hijacked node's modifications wouldn't be accepted and written.

    2. They're essentially attempting to find the solution to a maths problem (albeit a very, very complicated one) without being able to fully see what the problem is (because cryptography). Once solved, that enables the next block can be written (which is how transactions are committed) and the miners that solve the equation get rewarded with the new Bitcoin created from the creation of the block (this is where the "mining" part comes in). To use a poor analogy, think of this as gold miners finding a gold lode in a mine, extracting the gold, and then using the mined out area to permanently store equipment.
     
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  12. Steve Leo Beleck

    Steve Leo Beleck Squad Player

    Whilst I appreciate you taking the time to try to explain it, I think you would need to dial it down several notches for me to get it! I need it explained to me like Father Dougal had perspective explained to him I think.

    My current understanding is something like this: I want to buy something from Moose using bitcoin... I send him my code that's equivalent to the value in real money. He receives it and puts it on some website and you pitch up as a miner. You then look at my bit of code and verify it (not sure how?) and that means the transaction can then go ahead. You then play a guessing game trying to guess a long number for a reason that I can't quite fathom and if you're right, you get some Bitcoin too, hooray!

    I think I'm a lost cause here so no need to waste any more of your time.
     
  13. Bonkingbob

    Bonkingbob First Year Pro

    You have a wallet that is effectively a list of unspent transactions all stored in blocks on the chain.

    the record of blocks is stored in tens of thousands of computers all over the world. So instead of a bank’s database the proof you have the funds is in a record of previous transactions across all existing Bitcoin history stored in the blockchain.

    your wallet has an address like your account number, same for somebody you want to send Bitcoin to.

    you submit a transaction to send some Bitcoin to your mate, this gets broadcast to the network.

    miners are playing a giant game of battleships trying millions of times to find the right proof that you own those funds and verify the transaction. Its like trying to crack a password by trying every combination of letters and numbers. If a miner finds it they are rewarded and your Bitcoin is sent. This is what secures the network because no one entity has enough computing power to override all of the other people doing the same thing.

    Once a miner succeeds all of the other nodes verify they sank that battleship (which is a lot easier than finding it to begin with) and if it matches everybody’s records, success.

    Every block in the blockchain relies on all blocks before it being the same as the consensus on the network. Kind of a butterfly effect where one change to the entire historic records of transactions destroys that particular instance of it. Change a single thing and it becomes a fake. Any changes at any point in history would make that particular version of the chain invalid as nobody else on the network would agree.

    it’s a complicated beast but very clever. From a user point of view, you have a Bitcoin balance stored in an address accessed via a ‘wallet’. Your friend has an address for their own wallet. You send some of your coins to their address and pay a fee to the miners to verify that transaction for you. That transaction is magically agreed by random people all over the world at the same time and your friend receives the Bitcoin.
     
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  14. Bonkingbob

    Bonkingbob First Year Pro

    This may help
     
  15. Otter

    Otter Gambling industry insider

    Is it right that every transaction in a cryptocurrency is carried in the blockchain? Therefore won't it eventually become incredibly large and thus requiring more computational power? The idea of it seems good until you take on board the fact that unlike a nation's currency it is backed up by nothing, I guess that explains the volatility of its value. Also something will have to be done about the energy usage, in these times when governments are aiming to cut carbon emissions rapidly you can't have something on this scale impeding that.
     
  16. Arakel

    Arakel First Team

    The vast majority of modern currencies are backed by nothing when it comes down to it. That wasn't always the case, of course.
     
  17. Bonkingbob

    Bonkingbob First Year Pro

    re. the size of the chain it is growing and fairly large at 320gb but that’s smaller than most laptop hard drives nowadays so it seems to be growing slower than general disk space considering it’s been going for over a decade. There are advocates out there to increase block sizes to allow more transactions at once but it’s contentious due to storage.

    energy usage is a fair point but it’s also driving innovation. I see it in the future a bit like what F1 has done for road car efficiency. Use less energy for the same results and you have a cost advantage. There’s mining farms using geothermic power in existence.

    comparing to a nations currency is where the whole point in crypto economics lies.

    no currency is backed by anything physical, other than perhaps the army that backs that nation. It’s not linked to a physical collateral and is purely priced on confidence. The reason the pound is becoming more valuable against the dollar is that we have vaccinated lots of people and by extension the market thinks our economy has an advantage.

    a pound is worth nothing if nobody has faith in its value and the same applies to Bitcoin. The difference with Bitcoin is there is a finite supply that can ever be minted so no central bank can purposely devalue the currency by printing more and increasing supply. It is deflationary by nature.
     
  18. No idea about this stuff and never bothered to get involved.

    What's going on?! Is bitcoin dead on its a*** or is this just one of those peaks and troughs that happen? Will it come back stronger?

    Is anyone involved and lost/gained anything through trading it?
     

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