Bitcoin, Cryptocurrency and Blockchain Discussion Thread

[blckdmp]

Sounds like a good idea. The narrative that the decentralized nature of Bitcoin and other crypto prevents any kind of energy accountability from being attached is a false narrative designed to make the cleaning up of crypto impossible.

I guess my concern is that the lack of accountability is a feature of good crypto, not a flaw. Miners have genuine power when it comes to blockchain security and I would think the crypto community would balk at anything that allows for governments and other third parties to regulate/influence how they mine.

 

[StealthP3D]

I guess my concern is that the lack of accountability is a feature of good crypto, not a flaw. Miners have genuine power when it comes to blockchain security and I would think the crypto community would balk at anything that allows for governments and other third parties to regulate/influence how they mine.

Certifying coins that are produced with renewable energy as such does not regulate them. It would be like broccoli growers going to an organic certification agency for certification that their broccoli was grown using well-defined organic techniques. The other broccoli growers might not like it, but there is nothing they can really do about it other than decide to get certified themselves so their broccoli can sell to buyers who demand organic.

It's beyond me why anyone would argue the buyer shouldn't have the ability to know whether their crypto was produced in a sustainable manner. It a position that is very cynical and doesn't lend itself to improving the world we all depend upon.

 

[willow_hiller]

I guess my concern is that the lack of accountability is a feature of good crypto, not a flaw. Miners have genuine power when it comes to blockchain security and I would think the crypto community would balk at anything that allows for governments and other third parties to regulate/influence how they mine.

Does it necessarily need to be government or third party regulation? Couldn't it just be the market collectively deciding that the use of renewable energy is a valuable commodity, and tokenizing that concept?

Just doing a little bit of simple research on the different types of consensus mechanisms for blockchains here: Consensus (computer science) - Wikipedia

And of particular note they say that smart grids are real world application of consensus: Smart grid - Wikipedia

It could be as simple as cryptocurrency miners having their pools connected to smart power meters that are capable of reporting the renewable status of the incoming energy at any given moment, and generating renewable energy tokens in proportion. No need for any regulation or even certification, as long as the consensus mechanisms can be trusted. And then it's just down to the market to bid for those tokens to assign them a value.

 

[StealthP3D]

It could be as simple as cryptocurrency miners having their pools connected to smart power meters that are capable of reporting the renewable status of the incoming energy at any given moment, and generating renewable energy tokens in proportion. No need for any regulation or even certification, as long as the consensus mechanisms can be trusted. And then it's just down to the market to bid for those tokens to assign them a value.

I don't know a lot about this but it would seem certification agencies in other industries, organic produce for example, exist simply because there are no fool-proof mechanisms that can be trusted. The goal with certification agencies is to make it more risky and more difficult to fool the certification process than it is to just comply with the requirements.

 

[StealthP3D]

Does it necessarily need to be government or third party regulation? Couldn't it just be the market collectively deciding that the use of renewable energy is a valuable commodity, and tokenizing that concept?

Certification agencies don't regulate, they only certify. They exist as an unbiased third party who can certify that something is what the seller claims it is.

 

[blckdmp]

Certifying coins that are produced with renewable energy as such does not regulate them. It would be like broccoli growers going to an organic certification agency for certification that their broccoli was grown using well-defined organic techniques. The other broccoli growers might not like it, but there is nothing they can really do about it other than decide to get certified themselves so their broccoli can sell to buyers who demand organic.

It's beyond me why anyone would argue the buyer shouldn't have the ability to know whether their crypto was produced in a sustainable manner. It a position that is very cynical and doesn't lend itself to improving the world we all depend upon.

Don't get me wrong. I think that having the energy source certified would be fantastic. I'm trying to be realistic, not cynical. I guess in this scenario, who certifies the mining operations in China/ Russia/ Nigeria etc... ? It seems to me that by the time you had a certification body that could truly be trusted to guarantee the clean energy requirement that many crypto enthusiasts would see that as overreach and overregulation of the space. Even something as "simple" as certifying organic food is rife with corruption/fraud.

Organic Food Fraud in 2020

Sales of organic food have increased since the global coronavirus pandemic started. Sales in the USA were up 50% in March 2020. An Organic Trade Association poll of “likely organic shoppers…

www.foodfraudadvisors.com

Organic labeling fraud is booming

While organic market growth is at a double-digit pace, not all that’s labeled organic is so. Fraud and food safety issues abound.

www.farmprogress.com

 

[StealthP3D]

Don't get me wrong. I think that having the energy source certified would be fantastic. I'm trying to be realistic, not cynical. I guess in this scenario, who certifies the mining operations in China/ Russia/ Nigeria etc... ? It seems to me that by the time you had a certification body that could truly be trusted to guarantee the clean energy requirement that many crypto enthusiasts would see that as overreach and overregulation of the space. Even something as "simple" as certifying organic food is rife with corruption/fraud.

Organic Food Fraud in 2020

Sales of organic food have increased since the global coronavirus pandemic started. Sales in the USA were up 50% in March 2020. An Organic Trade Association poll of “likely organic shoppers…

www.foodfraudadvisors.com

Organic labeling fraud is booming

While organic market growth is at a double-digit pace, not all that’s labeled organic is so. Fraud and food safety issues abound.

www.farmprogress.com

Like I said, certification in this context is not regulation and it can't be considered "overreach" because it's entirely voluntary. The only reason a crypto miner would participate is so they could sell their product to people who would only buy certified crypto.

 

[lascavarian]

Crypto has some seriously unflattering aspects but I don't think rewarding the criminal element is one of them. Cash is the currency of choice for criminals because it is far less traceable than crypto. Crypto leaves it's fingerprint wherever it goes and it is a very public fingerprint that never fades or goes away. It's called a public ledger. Cash changes hands without this tracer and is the currency of choice amongst criminal elements who want to leave no trace.

Given this is well-known, I'm surprised there are still people pushing the false narrative that crypto has a stronger link with criminal behavior than the actual tool of choice and the most widely accepted currency for criminals around the globe, the US greenback.

Notice how this comment quickly diverts to discussion away from the expanding crime around crypto.

Please just keep looking at "cash" and describe it as a problem. Try to make it appear that "cash" is a larger problem than ransomware crypto attacks, yeah that's the ticket.

Just days ago the East Coast of the US was nearing panic as criminal elements ransomed an entire pipeline. Of course they chose cash as their method of payment ---- NOT.

The so called "public ledger" is a joke. It does nothing but provide cover for the ponzi. No payment for this ransomware will be recovered because crypto is so easy to use for theft. Crypto moves in a flash and has no problem with fraudulent credentials. Poof!

There is no central authority to administer controls or censure bad actors. Criminally delicious!

 

[lascavarian]

Don't get me wrong. I think that having the energy source certified would be fantastic. I'm trying to be realistic, not cynical. I guess in this scenario, who certifies the mining operations in China/ Russia/ Nigeria etc... ? It seems to me that by the time you had a certification body that could truly be trusted to guarantee the clean energy requirement that many crypto enthusiasts would see that as overreach and overregulation of the space. Even something as "simple" as certifying organic food is rife with corruption/fraud.

Organic Food Fraud in 2020

Sales of organic food have increased since the global coronavirus pandemic started. Sales in the USA were up 50% in March 2020. An Organic Trade Association poll of “likely organic shoppers…

www.foodfraudadvisors.com

Organic labeling fraud is booming

While organic market growth is at a double-digit pace, not all that’s labeled organic is so. Fraud and food safety issues abound.

www.farmprogress.com

You are correct. Organic certification can be nearly meaningless in some instances. Case in point is "Organic Honey", a label but not much more.

There will be no "clean crypto" beyond a few small players and talking points IMO.

 

[aubreymcfato]

Just a reminder that only proof of work uses that much electricity (thus centralizing mining operations in the hands of the few who can invest enough to reach economies of scale).
There are also proof of stake crypto. None is perfect, but in this decade a lot of crypto allegedly solved some of the issues of Bitcoin and Ethereum (which is very slowly transitioning from PoW to PoS).
It's a very lively industry, with a lot of scams and hype but some legit projects.
The point that really doesn't make sense is Elon liking DOGE, that only has "dogs and memes" (per his words) but no tech or economic advantage.

 

[Beltsbear]

BTC is designed to be unregulated and unregulatable. Once a coin is on the ledger it's worth the same as any other. And since BTC miners are driven by pure greed, they're not going to limit their computers to only mining when excess green energy is available. As long as the payoff is higher than the cost, they'll run.

The whole crypto world is chaotic. Anybody with the programming skills and a computer can start a new crypto, creating illusory value and adding to the chaos. It's useless as currency precisely because lack of regulation precludes a stable value. Companies that accept crypto base their prices on dollars (or other local currency) and convert back to the local currency immediately. For a currency to function as a currency, it must be regulated to maintain a predictable and relatively stable value.

By its very nature crypto may be impossible to stop, but it is also useless for legitimate transactions. It's too unstable, and transaction costs, which were subsidized by the miners when mining was more profitable, skyrocket as fewer and fewer coins remain to be mined. It's a Ponzi scheme with big profits at the start and for early adopters, and big costs for later adopters.

And the more cryptos appear (which they will because it's basically free to start a new one) the situation only becomes more chaotic and less profitable.

Also, since lost coins cannot be recovered, the total supply will diminish, and since there's no way of knowing how many coins on the ledger are lost and unrecoverable, the real "money" supply of crypto is unknown, adding to the uncertainty and the volatility.



Felix Salmon of the Slate Money podcast has pointed out that large-scale effective ransomware was made possible by crypto, since it makes untraceable on-line payments possible. Your local corner dope peddler takes cash because that's a face-to-face interaction. Same with your small-time gun dealer. But for extortion and ransom, crypto eliminates the biggest risk point for the criminal: The cash drop. Crypto also makes possible untraceable transactions on the dark web for everything from drugs to sex slaves. In short: Cash is the choice for small-time criminals, crypto for the really big criminals. And crypto is useless for anything else.

If I pay for something with my credit card and the seller fails to deliver, I can file a claim with my bank and get my money back. If I buy a loaf of bread with my credit card the transaction costs pennies. If I did it with crypto the transaction cost ranges from around $5 to $50. For one loaf of bread! If you're extorting $10,000, a $50 transaction cost is worth it for the protection that crypto provides. Nobody uses crypto as currency except criminals. The true believers are not spending it. They're HODLing it, in hopes of making speculative profit.

Your statements are true for Bitcoin fees but not for crypto in general. Dogecoin and BCH fees are closer to pennies. BCH is use for more transactions now on an hourly basis than Bitcoin.

 

[Beltsbear]

Just a reminder that only proof of work uses that much electricity (thus centralizing mining operations in the hands of the few who can invest enough to reach economies of scale).
There are also proof of stake crypto. None is perfect, but in this decade a lot of crypto allegedly solved some of the issues of Bitcoin and Ethereum (which is very slowly transitioning from PoW to PoS).
It's a very lively industry, with a lot of scams and hype but some legit projects.
The point that really doesn't make sense is Elon liking DOGE, that only has "dogs and memes" (per his words) but no tech or economic advantage.

Doge has lower fees. And it would have lower fees even if widely adopted. So Doge has an economic advantage. While Doge has mostly not changed in years, the community is more open to major changes than the Bitcoin community. Bitcoin will never change from PoW that is SHA256, it could go down in value 90% and the community would not change. Blocksize is not changing anytime soon either. The Doge community will almost certainly do any sane proposal that Elon seriously pushes.

 

[lascavarian]

The point that really doesn't make sense is Elon liking DOGE, that only has "dogs and memes" (per his words) but no tech or economic advantage.

The more one understands about the many regrettable features of most crypto currencies, the more DOGE (even as messy as it is) looks better IMO. I would not go near it other than as a friend of the prank. DOGE pranks the more serious cryptos and there is rich irony to feast upon.

 

[elasalle]

so we want decentralized ledgers with no central over-sight needing to get certified by a renewable over-sight committee?

 

[daniel]

Almost complete lay-person here, but couldn't this issue be solved at the market-level by introducing some sort of REC (originally Renewable Energy Credit, maybe in this context a RenewableEnergyCoin) that's created when a BTC block is mined using renewables? Could trade separately, be bought by BTC users who want a token representing an offset for any transactions they conduct.

Similar to how Solar Renewable Energy Credits work. My solar panels generate kWh which sell on the open market as normal electricity does, but they also generate SRECs which act as tokens representing the additional value attributed to the fact that the kWh were generated with solar panels. And anyone who has a mandate to use renewable energy can bid to purchase my SRECs, which allow them to claim they're using renewable energy.

In the course of time, all coins get jumbled together. Any distinction between sustainably-mined and mined-with-coal-power will disappear.

And the market in Renewable Energy Credits really rubs me the wrong way but I'm not sure I can articulate the problem. Let's say a steel plant buys RECs but burns fossil fuel. Wouldn't it have been better for the planet if the plant had converted to sustainable energy instead of just buying offsets? We will never get to a sustainable energy regime as long as we're still burning fossil fuel. And if polluters have a choice between cleaning up their operation or just buying offsets, they'll never clean up. They'll just keep buying offsets.

I think that carbon offsets and RECs are a scam by polluters to avoid having to stop polluting.

Your statements are true for Bitcoin fees but not for crypto in general. Dogecoin and BCH fees are closer to pennies. BCH is use for more transactions now on an hourly basis than Bitcoin.

Crypto by its nature is volatile. This is because it is unregulated by design. A stable currency requires regulation . Because crypto is so volatile it cannot serve as a useful day-to-day currency. BTC may be the poster child for outrageous transaction fees, but any crypto that cannot be traced and seized by law enforcement, and that offers no means to reverse a fraudulent transaction, is an invitation to criminals.

Even the ones with lower energy footprint and lower transaction costs serve only two purposes: Speculation and crime.

 

[mekberg]

so we want decentralized ledgers with no central over-sight needing to get certified by a renewable over-sight committee?

Governance tokens.

 

[aubreymcfato]

The more one understands about the many regrettable features of most crypto currencies, the more DOGE (even as messy as it is) looks better IMO. I would not go near it other than as a friend of the prank. DOGE pranks the more serious cryptos and there is rich irony to feast upon.

I think the irony has long gone from the project, at least in a "one layer " version. Yes, it was a prank, but now is a memecoin. The community will make tweets and memes and will pump the coin to the moon, not because it's a joke vs other crypto, but for the sake of it, aka for the money.

 

[lascavarian]

It is interesting to review the responses to the topic of using renewable energy for mining.

Bitcoin Mining Council To Report Renewable Energy Usage - Slashdot

A new Bitcoin Mining Council has been created to improve the crypto-currency's sustainability, following a meeting of "leading" Bitcoin miners and Elon Musk. The BBC reports: It's hoped the council will "promote energy usage transparency" and encourage miners to use renewable sources. According...

hardware.slashdot.org

 

[LiveLong&Profit]

Judging from what I've seen, it seems like Elon might have a plan for creating "ethical" or "green" Bitcoins (or other cryptocurrency) that is certified with with it's own proof of authenticity. These would naturally be worth more in the crypto markets (my guess is much more) in the same way that diamonds have laser engraving certifying they are ethically sourced and gold bullion coins minted by different countries have different values even though they might be the same amount and the same purity.

As crypto becomes more ubiquitous, it's obvious that companies that accept it will naturally gravitate toward "green" or "ethical" crypto and thus these are the ones people will invest in. The others, the ones that resist, will never be very important and probably become all but worthless.

Agree.
One way to do certified green energy is to use blockchain to make a kind of energy Non Fungible Tokens/NFTs.

Unlike other carbon trading quotas and/or green energy schemes, which has historically been hard to trade and/or subject to various kinds of creative use (scammy behaviour) NFTs could be a new way to trade green energy, 'cause blockchain tech would guard against dual use and/or other ways to abuse quotas/units of energy.

NFTs are perceived to be highly trustworthy: NBA top shots were one of the first adopters has sold a variety of basketball collectables for 230.4 million USD total in march 2020 alone, and the current record for a single digital assets is, I believe, a work by artist Beeple: 60 million USD.

(AFAIK NTFs are currently implemented by smart contracts in Ethereum only - but the idea is generic, and many blockchains have plans for or are in the process of rolling out smart contracts, NFTs - or both)

 

[daniel]

NFTs might be a way to trade green energy credits (carbon offsets or renewable energy credits) but that won't work for crypto unless the entire currency is required to be certified green. If you have, say, some bitcoins mined with green energy and certified, and others not, then as fractional coins are traded, and then those fractions united to trade as whole or larger-fraction coins, you'll end up with green and non-green coins and fractions all jumbled together. And don't trades require multiple servers all to process the trade? Some will be using dirty energy and others green energy.

Unless you create an entire cryptocurrency (one more in the vast sea of different cryptos) that's required to be mined and traded with green energy there's no way to keep green and dirty coins distinct.

And since miners are mostly in it for the cash, most of them will just keep using the cheapest energy they can get.