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These low hanging counters have been discussed over a lot. Transaction cost is pretty low in multiple views: - You can globally settle billions of dollars wor

These low hanging counters have been discussed over a lot. Transaction cost is pretty low in multiple views: - You can globally settle billions of dollars worth of bitcoin for less than 10$ [0] - FIAT Settlements between banks is a complicated and non-auditable process, which is internationally speaking also very slow - You can build layers on top of bitcoin, i.e. the Lightning Network or liquid, which reduces transaction costs and time by a lot (sub cent range in the lightning network) Energy usage is not tied to transaction throughput. It is vital to be very high in the future, as it secures this global and auditable settlement network. Mining is a very competitive business. Renewable and unused energy IS the cheapest energy available (without govt. subsidies), thus the most competitive miners will use them. Mining also "subsidizes" research in cheap energy, as it gives you a competitive advantage. [0] https://twitter.com/CoreFeeHelper/status/1366787351985287168 https://twitter.com/CoreFeeHelper/status/1366787351985287168

boringg 6y ago
Im answering his question why bitcoin is not the best use of money: (1) Most people don't settle on large volumes (thats typically banks/states/institutionals) so small volumes have a high cost percentage making it not a good daily driver. The fact that there is any transaction cost makes it challenging to work with as a daily money vehicle for consumers. (2) It requires energy to exist and keep a ledger, it also requires energy to mine. Your comment on renewable energy isn't accurate sadly and unused energy works only if you can get access to it which isn't universally available. In some jurisdictions renewable energy beats on price but this is largely on huge projects that are bid into utility grids (At least in North America). It will get there but still needs more time. I don't see how mining subsidizes research in cheap energy. Understand they have been debated ad nasueum and the reason is that they haven't really passed muster for the use case we are talking about. Don't equate my arguments as saying bitcoin is bad - it doesn't have a good universal use case for money and it does have negative environmental benefits associated with it.
- ballofrubber 6y ago
  (1) I think people assume that just because bitcoin exists banks will vanish. Bitcoin is the protocol that banks can use, but individuals as well. Also, micropayments on Bitcoin exist today. I encourage you to download a lightning network wallet (e.g. Breez Wallet: non-custodial and open source) and send me a "lightning-invoice" I can pay you in the sub-cent range. (2) It requires real world resources to be spend and uses the most globally available resource, energy. I see it as a feature not a bug. Renewable energy is the cheapest though[0] and thus the one that competitive miners need to use. Non-competitive miners get driven out very fast thanks to the difficulty adjustment. Any percentage of optimization you can get in your energy production you can use to outperform other miners, thus get more of the block subsidy and drive out inefficient miners. Bitcoin mining de-risks investments in energy producing facilities. You always have a buyer for your energy, which is a problem especially in renewables. [1] [0] https://en.wikipedia.org/wiki/Cost_of_electricity_by_source https://en.wikipedia.org/wiki/Cost_of_electricity_by_source [1] https://www.sciencedirect.com/science/article/abs/pii/S1364032120308054 https://www.sciencedirect.com/science/article/abs/pii/S13640...
  - arrosenberg 6y ago
    > It requires real world resources to be spend and uses the most globally available resource, energy. I see it as a feature not a bug. Such a horrific, unproductive use of energy is definitely a bug from a scientific perspective, maybe not for a financier.
    - lottin 6y ago
      Proponents of Bitcoin are rarely financiers. It's clear to me that they don't understand finance.
    - ballofrubber 6y ago
      I think from a scientific view, allowing and observing the experiment bitcoin is extremely interesting. Nothing like it has challenged economic thinking in the last decades. It is very productive for a large population of the world.[0] Not everyone gets paid in a stable currency or has easy access to it. [0] https://www.youtube.com/watch?v=xLYYh4aPXAM https://www.youtube.com/watch?v=xLYYh4aPXAM
deleted 6y ago
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boringg 6y ago

Im answering his question why bitcoin is not the best use of money: (1) Most people don't settle on large volumes (thats typically banks/states/institutionals) so small volumes have a high cost percentage making it not a good daily driver. The fact that there is any transaction cost makes it challenging to work with as a daily money vehicle for consumers. (2) It requires energy to exist and keep a ledger, it also requires energy to mine. Your comment on renewable energy isn't accurate sadly and unused energy works only if you can get access to it which isn't universally available. In some jurisdictions renewable energy beats on price but this is largely on huge projects that are bid into utility grids (At least in North America). It will get there but still needs more time. I don't see how mining subsidizes research in cheap energy. Understand they have been debated ad nasueum and the reason is that they haven't really passed muster for the use case we are talking about. Don't equate my arguments as saying bitcoin is bad - it doesn't have a good universal use case for money and it does have negative environmental benefits associated with it.

ballofrubber 6y ago
(1) I think people assume that just because bitcoin exists banks will vanish. Bitcoin is the protocol that banks can use, but individuals as well. Also, micropayments on Bitcoin exist today. I encourage you to download a lightning network wallet (e.g. Breez Wallet: non-custodial and open source) and send me a "lightning-invoice" I can pay you in the sub-cent range. (2) It requires real world resources to be spend and uses the most globally available resource, energy. I see it as a feature not a bug. Renewable energy is the cheapest though[0] and thus the one that competitive miners need to use. Non-competitive miners get driven out very fast thanks to the difficulty adjustment. Any percentage of optimization you can get in your energy production you can use to outperform other miners, thus get more of the block subsidy and drive out inefficient miners. Bitcoin mining de-risks investments in energy producing facilities. You always have a buyer for your energy, which is a problem especially in renewables. [1] [0] https://en.wikipedia.org/wiki/Cost_of_electricity_by_source https://en.wikipedia.org/wiki/Cost_of_electricity_by_source [1] https://www.sciencedirect.com/science/article/abs/pii/S1364032120308054 https://www.sciencedirect.com/science/article/abs/pii/S13640...
- arrosenberg 6y ago
  > It requires real world resources to be spend and uses the most globally available resource, energy. I see it as a feature not a bug. Such a horrific, unproductive use of energy is definitely a bug from a scientific perspective, maybe not for a financier.
  - lottin 6y ago
    Proponents of Bitcoin are rarely financiers. It's clear to me that they don't understand finance.
  - ballofrubber 6y ago
    I think from a scientific view, allowing and observing the experiment bitcoin is extremely interesting. Nothing like it has challenged economic thinking in the last decades. It is very productive for a large population of the world.[0] Not everyone gets paid in a stable currency or has easy access to it. [0] https://www.youtube.com/watch?v=xLYYh4aPXAM https://www.youtube.com/watch?v=xLYYh4aPXAM

deleted 6y ago

[deleted]