[Cryptography] Billions of dollars on the table, and other people are grabbing it.

[Tom Mitchell]

On Thu, Jan 14, 2021 at 8:42 PM jrzx via cryptography <
cryptography at metzdowd.com> wrote:

> A great many big crypto mining corporations are making a great deal of
> money, and a lot of big, smart, wealthy investors plausibly believe that
> investing in crypto mining is likely to be more profitable than investing
> in crypto currency, and speculating on crypto miners is likely to be more
> profitable than speculating on crypto currencies.
>
> Proof of work is necessarily expensive, to resist the 51% attack, and
> tends to be slow *because* necessarily expensive.
>

An economic geologist will tell you that the market price of a metal or
other natural resource has a floor set by the current cost of production.
The last 10% of the production sets the current price (demand elasticity vs
price).

Disruption in the cost structure can result by overproduction of
properties with common economics by discovering another property.
Substitution of aluminium for copper had impact except for the resistive
interconnect problem of aluminum home wiring.  Power distribution
is now aluminum with steel for tensile strength.

Gold production in Nevada was enabled by a benefaction trick that allowed
ore with parts per million gold to be mined at scale.
The Nevada Bureau of Mines made Nevada a gold producer larger than most
nations. I mapped for $100 a day the surface geology
of what turned out to be a billion dollar producing mine, sigh.

Oil production was stable only because of OPEC and other international
controls.

Fracking was and is price disruptive and much but not all anti fracking is
economic protectionism.

GPU production upset the bitcoin market for a while and made mining very
profitable.

If I dust off my copy of "Programming Pearls" I see the specter of
algorithmic disruption in the bitcoin markets.
It makes the value of a clever mind important.

Mining is cumulative stockpiling.  If an activity is free of power cost
like  https[://www[.helium[.com/mine
the rake off is profitable even if the mining itself is expensive.

Diamonds...  a managed market not a true market.








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          T o m    M i t c h e l l ( o n   N i f t y E g g )
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