PoW incentivizes renewable energy development. It's certainly not rolling it back.
It used to also incentivize GPU production, but as of today that has been diminished as well. Instead it is only current asset holders who reap the rewards.
PoW incentivizes energy development. And then proceeds to use it all up on PoW. It's a paperclip optimizer, except the fitness function is how much power it can waste.
> It used to also incentivize GPU production
And then proceeds to use it all up on PoW. It's a paperclip optimizer, except the fitness function is how much e-waste it can produce.
It's for these reasons I'm not super convinced in the proof-of-storage type proposals. All it'd do is change what was being wasted. proof-of-stake seems to be the one proposal that avoids ridiculous amounts of waste. The only downside of course being that it essentially hard-codes the "1% of people make 99% of the money" principle.
Even more so because realistically you need to set it up somewhere where electricity is cheap which which is a centralizing force in itself. Also you need to have a really efficient mining rig for it to be profitable. With Ethereum PoS you can easily home stake on a Raspberry Pi which means it is much easier for regular people to participate.
> The only downside of course being that it essentially hard-codes the "1% of people make 99% of the money" principle.
This is only true if the only or best way to make money is through staking. This is unlikely to be the case - the ability to deposit your cash in a savings account or park it in government bonds doesn't stop people from investing in stocks. What it does instead is put a floor on acceptable rates of return from more risky options.
You already occasionally have to wait for solar panel deliveries. (depending on your location) By buying them for mining you effectively make others wait and not use them for moving off fosil fuels. Additionally, both solar panels and batteries still rely on mining actual limited materials, so every one used for crypto effectively means one less for useful purposes in a long run.
I don't really follow - 3090s are below £1000 each, you hit 2000W power consumption with just 4 of them, so £4000 on GPUs. 2000W panels + battery is going to be at least £15-20k at current prices. Not sure why affording one would mean being able to afford the other.
2000Wh power station can be had for <$2k and 2000W solar panels for ~$2k. 3090s don't really consume 500W, more like 350W and that assumes regular voltages; in reality for mining it's much lower. 3080Ti would be even cheaper for about the same throughput.
Yeah but you have the rest of the system to account for. And you need more than just what the system uses to charge the battery storage for overnight use - probably 4000W of panels if not 6kW. The batteries are the most expensive part of this(unless you only want to run the system for few hours during the day, but then what's the point?). You mentioned a 2000Wh power station, but I'm not sure how that helps? That will only store enough energy for an hour of running at most. So yeah, you're looking at about £15k for the whole power system alone.
All the other people are free to buy the cheaper/more efficient solar panels for their own purposes. Why do you care that somebody uses them for Bitcoin? Do you also care that I shower with hot water a lot?
Well, if they are being bought for PoW mining there is a good chance that they would then become more expensive for other uses. It is not like we have solar panels just laying around and nobody tough of using them before PoW came along.
Hmm, I'm not so sure about that. To me it seems much more like the increased demand has generated a lot of competition and that got prices way down from the levels just 5-10 years ago.
And that is exactly why we should base plans and decisions on the actual facts we are sure about and can measure and verify and provide citations to prove, not just our feelings about how things seem and how we wish the ideal world worked in our childish libertarian fantasies and get-rich-quick pyramid schemes.
So where's your data? I bought a pretty large solar array by adding a panel or two over the years. It's so big now that I have more than enough energy to sell/mine BTC even in winter - and that's for a large old EU-style village house and I like to shower in hot water a lot and keep 24 degrees (admittedly, I use a little coal the week/two it's -20 outside), and I don't even have new windows - still these 100 year old wooden ones - nor modern insulation (my ceiling is insulated with >50 year old straw, lol).
Today it's possible to buy a shipping container full of incredibly efficient solar panels for just around 8k EUR and have it delivered the same month. If that's not cheap and available I don't know what is - and it definitely wasn't this good 5 years ago, not even playing the same game.
5 years ago I had to talk to a sales rep who wanted to visit me and do special deals (and tried to bag the difference from grid costs through their shit leasing), now I just order on an eshop, pay with card and it's done in 15 minutes. My last shipment last year arrived within a week after ordering, now it's worse because of the Russian war - but that applies to everything related to energy, and there are new companies trying to cater to this new market already, it just takes some time to ramp up.
Each year the availability, efficiency and price of solar panels improved for me. You're claiming it got worse because of crypto - based on what? To me, your snark seems just like a childish socialist fantasy and anti-money/market scheme, and the reality starkly disagrees.
I'm not paying for it, I have my own solar arrays. And after I am finished I'll redirect the unused energy to BTC mining again - the grid pays less than half of what I get from mining. Nobody's business.
Are you suggesting the high-end semiconductor shortage was caused by crypto? I don't think so. When you have Apple buying out the entire 5nm TSMC capacity for a year/more - in direct competition with NVidia, it's a hard proposition to make. And it's not like the GPU vendors were unhappy about the high prices and/or tried hard to get more production capacity.
BTW you don't mine Bitcoin with GPUs, that's impossible for at least 5+ years now. Bitcoin is mined with ASICs that are using older production nodes (+-30nm and the like).
The semiconductor shortage? No. The GPU shortage, and the insane prices also due to scalpers abusing the shortage?
100%. yes.
Shall we pretend you replied in good faith to a post asking "Same as people were free to buy graphics cards for gaming in the last couple of years?", genuinely misunderstood the question, genuinely missing the "graphics card" and thought only of the general semiconductor shortage in your answer?
Well my point is, you make GPUs in the same factory where you make CPUs and networking chips. So first have a look at what happened there - e.g. a massive new client has appeared and booked out the entire capacity that usually Nvidia and AMD were getting. Are you saying this 100% surely had zero impact?
And again, I was talking about Bitcoin, and you don't mine it with GPUs, and ASICs don't compete with GPU production capacity. So who replies in bad faith? I'm happy to believe the other commenter genuinely missed me talking about Bitcoin, so I mentioned it again. Then you come here with your attack...
Fair point about Apple buying out the output of TSMC's 5nm line - but Nvidia used Samsung's 8nm process. One could argue some orders were displaced due to TSMC being booked out, thus crowding Samsung's capacity as a cascade effect, driving prices up, or that Nvidia would have used a different process or booked capacity on both factories if it was possible.... but on the other hand Apple likely financed the entire 5nm line (it's pretty much in line with their operational model and they did it in the past - although I'm writing with no evidence it took place in this specific occasion), so an argument could be made that such 5nm line wouldn't have even existed for a further year or 2 hadn't Apple basically paid for it.
I don't know precisely what's the net impact of all of the above, but I have reasonable suspicion it it pales compared to the miner-induced shortage (which enabled scalping - it would have hardly made sense otherwise).
And while I agree bitcoin hasn't used GPU mining in ages, you were replying to a graphics card related question, and the entire thread is about Ethereum PoW (GPU mined) being sunset with this merge.
I personally know people who were successfully mining crypto using GPUs in the last couple of years. If it was Bitcoin, Ethereum or Doge, I don't know and it doesn't matter to me. As soon as the crypto prices came down this year, they sold their GPU collection. So saying that miners used only ASICs is not true.
Yes, there was a semiconductor shortage, but miners made the situation worse for others because they each used tens of GPUs instead of just one as a normal person would for gaming or graphics work.
My friends who have an AI company bought out these miners by the dozen and are running it for training - and yes they got it by offering more money than gamers and buying the whole lot, so gamers got the short stick again.
Why is that not bad? I don't see where the value for society got so much better, if that's the measure you're using - I'd rather have someone run the Ethereum blockchain than generate catgirl porn pictures. But even that is IMHO more useful than a bunch of guys gaming, at least more people get to feel the effect of a GPU than if it was owned by a gamer and only ever used for his eye candy. Games also could simply use the available resources better and then the gamers wouldn't need such absurdly overpowered hardware.
Overall, I think we shouldn't be measuring usage of GPUs, solar panels or any other products like this and definitely shouldn't be saying who has a right to have it and who doesn't, or for what prices - that gets us into nasty situations with only nasty answers.
This is a product like any other, gamers don't have any right to get cheap GPUs. Somebody else offered more money for it and the vendor didn't take the low-end market - that's just how it is.
>The only downside of course being that it essentially hard-codes the "1% of people make 99% of the money" principle.
Anyone can stake, and the more people that stake, the smaller the reward, so the result should end up being that more people join in until the expected reward is lowered to that of other widely-available investment opportunities.
It creates a system where money makes money. It's hardly surprising if that leads to the richest people making the most money. The result won't be more people joining in until the expected reward is low enough, The result will be that a few rich people will join in with enough ETH to push the reward down. There's probably be a bunch of small-time investors doing it too, but again, more ETH in is more ETH out.
It preserves a system where money makes money. You need money to buy mining hardware and energy. If you had enough money you could start mining. Now if you have enough money, you can stake.
If the reward is pushed down to be equal to the same reward that's available to anyone through widely available investment opportunities, then it doesn't seem like it's any more of an issue than how any other investment works.
> the more people that stake, the smaller the reward
In PoW reward is proportional to normalized "work". Reward is proportional to normalized amount staked. This very directly leads to wealth concentration.
In PoW, the "work" is just how much money the miner spends on mining hardware and electricity. Both PoW and PoS are cases where people with money invest that money and get a proportional reward. PoS just cuts out the hardware and electricity waste.
There is no reason PoW-incentivized energy development would have to be only used for PoW.
PoW means there can now be a buyer of last resort no matter when and where you are generating power. Newly developed renewable based electricity can be sold at "x" price when there is residential or commercial demand, and at "y" price (y < x) to a PoW miner otherwise.
In this scenario there may not have been enough demand at price "x" to finance the renewable development, but the PoW buyer of last resort makes it feasible.
In fact, it is precisely the reverse of that: it's not a buyer of last resort, it's an energy price FLOOR. Any energy that you could sell to a customer, must be sold above "y". And so it is with computer hardware - any top or near top wafer capacity item you may want to buy must be above "Y" (what a crypto miner would pay for it). And this is why we saw massive price hikes for consumer computer tech in the last two years.
And is this way - a price floor - and not the way you describe it, because of the economic incentives of miners. They have already paid for these captial intensive mining rigs, and to best turn a profit they must be running at all times. The marginal cost of mining is important, but given the capital costs (incl depreciation of hardware!) you cannot ignore it.
Basically, your explaination is a failure of first order thinking. To a first order approximation, only the marignal cost of mining matters and thus the scenario you describe is true. However, you must include the second and nth order effects of capex to truly match reality.
The miners don't need to be running at all times. If the cost of power exceeds mining returns then they definitely should not be running -- they'd be losing money AND wearing out their equipment. There is a middle ground where mining returns exceed power costs but don't fully cover capital expenditures, but the miner doesn't have to operate during that time if they think they are better off making no revenue but avoiding the wear on their machines. The question is whether you think you will have a period of cheap power in the near future, and in this case miners can benefit from the cyclical and predictable nature of power demand in answering that for themselves.
One can easily imagine a scenario where miners run overnight when power is cheap, turn their machines off during the day when power is in high demand and expensive (and you'd either lose money by having them on, or you would make less than you would by conserving your hardware and optimizing its usage), and earn a profit overall (while leaving the power producer better off too by letting them sell power that would otherwise be wasted).
>wear on mining machines
There is virtually no wear on mining machines from actual use. There is, but it's negligible compared the main cause of depreciation of mining machines: better hardware coming out every 2-4 years AND the reduction in mining reward rate[1]. A bitcoin mining rig is worth essentially 0 after 2 years due to this depreciation. Not failure from wear. This is also true for GPU miners.
Second, there are many better uses for cheap power - one could use it to store energy in a hypothetical future where we use lots of intermittent renewables. You could use it to produce highly energy intensive physical goods - aluminum, hydrogen gas, fertilizer. You could use it for intensive climate engineering with carbon capture.
Almost anything else you can think of would be better than running a proof-of-waste cryptocurrency network.
The free market hasn’t been operating and never will operate with the restrained controls on energy usage that you outline though.
Besides, there’s so many more useful things to do with that cheap renewable energy at times of low demand - synfuels, desalination, etc - that we should definitely see what else the free market can come up with given negative energy prices, rather than propping prices up by running pointless hash-computers for some speculative investment scam.
It's one thing to have excess power, and another to have excess power in the time and place that you want to do these things. For example excess solar energy in the middle of the country is never going to be able to be deployed to desalinate water in the ocean because you will lose it all in transmission and storage (or you will spend more than you would just generating new power near the desalinization plant).
This is what makes bitcoin mining so unique as a way to make use of excess energy. First of all, securing a censorship-resistant digital monetary system is not pointless nor a scam. Second of all, energy from anyplace on earth, at any time, can be deployed for this purpose -- all you need is a mining machine and an internet connection.
POW incentivizes wasting energy for a practice that turns it into money without the in between steps of creating businesses and jobs (read: progress), and that alone is a huge minus point. That energy is then wasted for more POW currencies, which implies that those who make the most money out of it can dictate energy prices.
The only way to bring back down energy prices isn't to create more, as it would quickly be allocated by highest bidders for more POW mining in an endless circle, but to reduce that toxic demand, and eliminating POW mining would represent a good start.
People had an option against the "you must believe me it has value" money and now it goes down the drain because a bunch of idiots are crying about "excessive" energy usage. It was the perfect energy backed money (like there was a gold backed money back then...).
Stockpiling food and lighting it on fire for warmth would incentivize more food production also, but if there are ways to generate warmth without wasteful steps, I think we can all agree they're unarguably better
PoW incentivizes renewable energy development for useless mining, but not for anything more than that I guess. At least the renewables can now be used to power other more necessary demands, if the owners don’t move on to mine other coins that are compatible with their rigs.
It used to also incentivize GPU production, but as of today that has been diminished as well. Instead it is only current asset holders who reap the rewards.
EDIT: Edited to include at least one source on the connections between PoW and renewable energy. This just scratches the surface though. https://squareup.com/us/en/press/bcei-white-paper