[Cryptography] An academic paper on Bitcoin's energy consumption

Ray Dillinger bear at sonic.net
Sun Jan 10 01:20:23 EST 2021


On Thu, 2021-01-07 at 17:33 -0500, Bill Frantz wrote:
> On 1/7/21 at 5:33 AM, ikizir at gmail.com (Ismail Kizir) wrote:
> 
> > The dependence of nearly 80% of the world’s energy consumption on
> > fossil
> > fuels and that this situation is not likely to change in the future
> 
> This is a very questionable assumption as the price of wind and 
> solar power is predicted to drop below that of fossil fuels 
> around 2025 (New York Times). It's amazing what happens to the 
> costs when the fuel cost is zero.

It shan't soon happen.  Even if the actual cost of producing a kilowatt
-hour of power somewhere happens to be technically zero at some time,
it still won't be something that people can use as though it cost
nothing.

Because as long as the *rate* at which it can be produced is limited,
there will always be the opportunity cost of energy.  Whatever I do
with it, I can't get the benefit of any of the other things I could
have done with it.  If I could have sold it to someone for a couple of
bucks, then using it for hashing bitcoin instead costs me a couple of
bucks.  If I could have used it to keep the lights on in my house for a
day, then using it for hashing bitcoin instead costs me the price of my
house staying dark.

The only real exception to this rule - where the world allows us double
dipping, so to speak - is where power is currently being used to
produce heat without first doing any other useful work, or where the
"waste" heat from using power to do other useful work has to be pumped
out into the environment using yet *more* power in order to keep the
machinery cool.  

Because the right kind of machinery for producing useful heat, causes
bitcoin hashing to be emitted as a waste product. Orrr, vice versa or
something, but the distinction is less important than it might first
seem.  So, yeah.  

Bitcoin mining can be energy-neutral if it allows someone to turn off
their heater in bitter Alaskan winters.

				Bear




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