Comment by smoldesu | Hacker News Reader

Comment by smoldesu | Hacker News Reader

I honestly can't agree with either article. Bitcoin's shortcomings are becoming apparent because it has hit an impossible edge case: after years of latent nerdspeak referencing cryptocurrency, one good rally got Wall Street to take notice. Now, everyone seems to have their own ideas about what Bitcoin should be: it's a store of value, it's a securities investment, it's a money laundering machine, or it's an alternative to the stock market. I don't blame Satoshi for staying hidden, because this is such a bastardization of what his vision of cryptocurrency really was. Bitcoin was free software, with the same purpose as the GNU coreutils or the Linux kernel: it was intended to empower the world indiscriminately, and provide opportunities and solutions to people who otherwise wouldn't have access to them. Bitcoin was a way to easily pay someone for a side job, or a private tip jar for your website. The current paradigm around what people perceive Bitcoin as is going to come crashing down, eventually. When it does, no nation will ever trust a digital currency again, thanks to an impending media shitstorm about how dangerous Bitcoin was.

From the start it seems the most prolific real applications of bitcoin have been on the margins of law and order. Sometimes this can be good -- when your government is oppressive and there is really no better way of transacting and storing value; anonymous writers or activists needing a source of income; etc.. But for the most part, it has no use in a functional society.

From the start the most frequent real world use cases were buying drugs and illegal services online (silkroad), and eventually other cases like ransomware (cryptolocker, wannacry), and a few other marginalized cases.

So in my view the mainstream adoption and glorification of Bitcoin is a tragedy, that I do think Satoshi himself (or Hal Finney) would eventually disagree with. The result of it is a colossal amount of wasted energy that could be prevented with traditional technologies (banks, public records, government databases), or more efficient alternatives (proof of stake, other forms of consensus) and hopefully more transparent as well.

> When it does, no nation will ever trust a digital currency again thanks to an impending media shitstorm about how dangerous Bitcoin was.

I don't think it is necessarily going to play out that way. While I can't think of a single use case that Bitcoin fulfills that the alternatives don't, digital currency, of some kind, is inevitably going to play an increasing role in our lives.

What is now known as "cryptocurrency" (blockchain based tokens) are just one kind of digital currency. There are at least 2 other kinds I can think of:

- Centralized databases of fiat-exchangeable equivalents (A "Fedcoin", Amazon vouchers etc)

- Federated Chaumian/Brandian anonymous digital cash systems (the forgotten cryptocurrency).

Personally I think it's only a matter of time before we get a digital currency based on one of these models sponsored by central banks / governments.

I don't see why Bitcoin can't continue exist long term with current sentiments. Some factions think it's a store of value, others say it's a security, or at worst, a money laundering tool. All of these same arguments can applied to paper bills-- and these arguments won't go away in 10, 20 years. There is no prevailing narrative for what it "is", though actors are certainly attempting to craft one. Sentiment in public markets will shift over time, up and down, sometimes dramatically, but nothing's convinced everyone we should all give up on Bitcoin --even after those dramatic falls-- and until that day, it has economic value. The US Stock Market survived the Great Depression, Bitcoin can (and did) survive the 2018 bubble.

I can't see bitcoin existing long term because right now I feel the only thing holding it up is it's brand. People know the word "bitcoin" and I'd venture that for 99% of the population that's the only crypto they know. BTC is however, pretty objectively, a really shitty crypto. Which is fine, it's the original one, it would be crazy if no one hadn't figured out how to improve on it.

I just think it is a matter of time before someone hits the right social cords with the right crypto and the wind is sucked out of BTC overnight. There are certainly tons of people trying.

There is no reason in my mind why bitcoin would crash. Gold has not (and no gold's price is not majorly driven by its industrial uses). If anything it is more like gold than ever before. Expensive, and difficult to find, transport, and spend.

The fact that gold is "Expensive, and difficult to find, transport, and spend." is mostly a problem for the havers of gold. The biggest problem for PoW cryptocurrencies is the wasted electricity and corresponding wasting of carbon output which is a huge negative externality impacting all the non-cryptocurrency havers too.

I would think the mining of gold also has massive negative externalities, including carbon output.

Your argument does not hold water: Gold consumes vastly more energy and produces vastly more CO2 to produce and move it than Bitcoin does. Or does the pollution from gold somehow not matter?

https://www.bbc.com/news/technology-56012952

Bitcoin consumes 'more electricity than Argentina'

What negative externalities does gold have that are worse than PoW cryptocurrencies? Gold mining is relatively miniscule. There is only something like 3,000 tons of gold mined per year and something like 200,000 tons mined in all human history. For comparison you can look at this[1]. We mine billions of tons of iron and steel every year.

Also the equipment used to mine cryptocurrencies doesn't magically appear. What percentage of the world's mining operations for copper, lithium, silver, etc. goes to building crypto-mining rigs? How does that total output compare to the 3k tons of gold?

[1] - https://www.visualcapitalist.com/wp-content/uploads/2020/03/...

Worth noting that (the last time I looked into it), the cost of mining gold was $850/troy oz [based on the filings of the largest mining company].

I don't know how much of that $75B/year translates to CO2 emissions, etc, or how it compares to BTC or what have you, but you can buy a lot of externalities for $75B.

I mean, how many tons of rock are removed for each ounce ton of gold is a more relevant figure maybe

Worst case scenario is something like, every dollar spent mining gold goes into diesel for machines moving dirt to find the gold, which amounts to something like 27 billion gallons of diesel per year, which amounts to something like 275 million metric tons of CO2 per year. Which would, in fact, be something like 7.5x more CO2 per year than BTC.

I'd put my estimate at something like 30-150 megatons of CO2/year for gold, just because I'd be surprised if they spent less than 10% of the cost of mining gold on fuel, or more than 50%. So I'd be neither surprised if gold generated less CO2 / year than Bitcoin, or if it generated like 4x more.

Aside from its noble properties and industrial uses, gold is a terrifically lustrous metal that most every human being in history has admired and desired. Its ability to convey wealth, luxury, power, and beauty has not diminished for thousands of years.

Bitcoin is a ten year old project, written in mutable code, that's invisible, intangible, and essentially replicable by any number of competing crypto projects or forks. It may be useful, or it may not be. It may stick around, or it may disappear. Either way, it's not seriously comparable to gold.

On the other hand, for the last 40+ years, we've seen a massive proliferation of lustrous materials produced, so much they literally cover our kid's bedroom floors. Luster, once rare, is now cheap and gaudy.

Only the extremely wealthy could line their floor with gold. You were comparing Bitcoin to gold, not "all lustrous materials". It remains a poor comparison.

There is only one gold with gold's properties and that's gold.

The same cannot be said for BTC.

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