Bitcoin mining hash rate drops as blackouts instituted in China

https://www.nasdaq.com/articles/bitcoin-mining-hash-rate-drops-as-blackouts-instituted-in-china-2021-04-16

by blondie9x • 5 years ago

322 398 5 years ago

the National Mine Safety Supervision Bureau has reported three recent coal mine accidents, including an April 10 “water penetration accident” in Xinjiang that caused 21 people to be trapped.
Significantly, the Xinjiang and Sichuan regions of China combined account for more than 50 percent of the overall Bitcoin mining hash rate

This is horrific on so many levels, I’m not even sure where to begin. My heart goes out for those poor miners slaving away for... what?

vkou• 5 years ago

My heart goes out for those poor miners slaving away for... what?

A paycheck, typically.

gruez8• 5 years ago

My heart goes out for those poor miners slaving away for... what?

coal?

bpodgursky5• 5 years ago

... to appease Germany's environmentalists who saw shutting down working nuclear plants as a major win.

(Yes, I know it's a different source of coal. But energy, in the age of oil tankers and thousand-mile pipelines, is fungible.)

taneq• 5 years ago

those poor miners slaving away for... what?

Bitcoin, apparently.

gruez8• 5 years ago

Where does it say bitcoin? The quote:

three recent coal mine accidents, [...] that caused 21 people to be trapped.

shp0ngle2• 5 years ago

This is actually good for bitcoin

lovecg• 5 years ago

You’re getting downvotes, but I think (correct me if I’m wrong) you meant something like the hash difficulty will adjust down if this is an extended downtime. So we would have fewer miners, easier hash difficulty and the same block rate. This would indeed be better for the environment, at least for the short term. This and the reduction in centralization could be argued as being “good” for Bitcoin.

shp0ngle2• 5 years ago

I actually meant it as a joke. Because according to Bitcoin enthusiasts, any news is actually good for Bitcoin.

sashimi-houdini2• 5 years ago

... because it reduces the power China has over Bitcoin

... because it attracts new players to the mining game

... because it will make the argument that bitcoin is bad for the environment weaker

I agree, the "any news is good news" is a fun game to play.

swinglock• 5 years ago

It hurts short term. This means the fees for Bitcoin transactions increase.

If not by the old mining power coming back online, it will be solved either by the next difficulty change, after which the Bitcoin network will again operate at full speed but using less energy, or by market powers if there are miners standing by due to not being profitable, which they now may be due to fewer miners to share the rewards with.

ChainOfFools4• 5 years ago

The Center of Decentralization sneezes and all of Bitcoin catches a cold

jachee• 5 years ago

The article ends weirdly abruptly:

It should also be noted that a mining difficult adjustment <EOF>

... what?

blondie9x2• 5 years ago

Crazy. Wondering why they got cut off? Here is more info https://ca.finance.yahoo.com/news/bitcoin-mining-pool-hashra...

almost_usual• 5 years ago

Maybe govts don’t like a currency created to subvert govts.

2bitencryption• 5 years ago

Significantly, the Xinjiang and Sichuan regions of China combined account for more than 50 percent of the overall Bitcoin mining hash rate

I don't get it, doesn't this effectively mean China can force a 51% attack by just strongarming the pools that operate there?

CharlesW• 5 years ago

Yes.

mrits3• 5 years ago

I'm not sure about that. Most miner operations in the US run only a fraction of the day to take advantage of electrical savings that a lot of operations in China wouldn't be doing. So if miners started returning higher yields we would output a larger hash rate. If we actually needed to protect against a 51% attack we could ramp up accordingly.

ChainOfFools4• 5 years ago

yeah, well more specifically they could force a preferred fork to assume the "Bitcoin" ticker (BTC) by denying power to chinese miners on the disfavored fork. exchanges and miners, rather than the developers, ultimately determine this, as there's no in-band way to control what ticker is used for trading what token.

gruez8• 5 years ago

That was tried a few years ago with the segwit2x fork. A group of miners comprising 82% of the hashpower got together and agreed to activate the segwit2x fork. Despite having a overwhelming majority of the hashpower the fork was never happened due to lack of community consensus.

https://dcgco.medium.com/bitcoin-scaling-agreement-at-consen...

ArchD• 5 years ago

That's not how it works. In the event of a hard-fork, when the two forks adopt different rules about what blocks are valid, the actual users of BTC still decide which rules to follow. If a miner produces blocks that are invalid according to the rules that are adopted, the blocks that it produces are just disregarded. Thus, the hash rate competition between miners is only within each fork.

If you are talking about denial-of-service by producing empty blocks or blocks that exclude certain addresses, that's another matter...

rantwasp• 5 years ago

that’s not how 51% attacks work. you have the miners but you also have the actual bitcoin nodes that are witnessing the blockchain growth.

bonestamp25• 5 years ago

Do the witnesses have any weight on the consensus?

dnautics• 5 years ago

No, it means that theoretically a 51% is possible but the levels of coordination required to do that and the ability of the bitcoin network to figure it out and ignore it are means that it is unlikely to be effective.

sillysaurusx3• 5 years ago

Plus, the model of BTC as “digital gold” is pretty resilient to 51% attacks: if you don’t touch your coins, no one can take them away from you. (A 51% attack can’t reassign coins.)

Of course, the price of BTC might tank in response to the news of a successful 51% attack, but it’ll probably bounce back just like every other event in BTC history.

c542• 5 years ago

doesn't this effectively mean China can force a 51% attack by just strongarming the pools that operate there?

Yes, in theory. There's a coordination problem to get all the pools to do what you want, but if they (or anyone) could pull that off, then yes.

So then what happens?

If a single entity controls >50% of the hash power of the network, they could start finding blocks with arbitrary (invalid) transactions and adding them to the chain. The transactions they'd be able to insert are called 'double-spends', which is that wallet A sends its balance to wallet B, and then in the next block sends the same balance (magicked into existence) to some third wallet C.

All this can happen. The way the network is supposed to work though, miners don't just commit new blocks and call it a day, the 'full nodes' have to accept the blocks. The miners are more or less offering up solved blocks to the full nodes for their acceptance.

As a full node it's trivial to take a look at this double-spend from A->C and say 'nope this doesn't look like a valid block to me, try again'. At this point if enough full nodes do this, the 51% of 'bad' miners are just wasting their time, the true hashrate of the network is now 49% of what it was a moment ago, and the remaining 'good' miners will continue to find blocks. Business as usual.

It's a much harder problem to control >51% full nodes, mostly because they're more geographically distributed. This is because they're pretty simple to set up at home and run, without worrying about up front cost of miners, electricity and noise and so on. A bitcoin full node can run on a raspi with a 1tb external hard drive, and a normal consumer internet connection.

Another interesting tidbit is that with control of 51% of the miners, this still only means a malicious actor finds a block first 51% of the time... to get the 6 blocks usually required for confirmation (in a row) is a ~3% chance. Not a perfect safeguard, but just some perspective on how hard it is to execute an attack like this.

The idea is that the miners are beholden to the full nodes, who are the actual actors in the distributed consensus system.

There's some other game theory around why one would want to do obvious double spends after having that much control (why not just sell the bitcoin and take profits?). But there are definitely reasons a state actor would want to try to destroy the network.

dangero• 5 years ago

inserting invalid transactions is not the double spend issue.

If their hash rate is over 50% they can "unconfirm" a confirmed transaction by making a chain with more work on it. This is how the attack plays out in simplified form:

Bitcoin is sent to an exchange by the attacker, confirmed, sold and withdrawn for cash. Attacker then makes a chain with more work on it than the chain where the Bitcoin was sent to the exchange. Now as far as Bitcoin network is concerned, the coins were never sent to the exchange, but the exchange already let the user sell the Bitcoin and cash out. So now the exchange has neither the cash or the Bitcoin. The attacker has both.

arcticbull4• 5 years ago

Yes, in theory. There's a coordination problem to get all the pools to do what you want, but if they (or anyone) could pull that off, then yes.

A strongly worded memo from Xi should sort that out, unless of course they want to switch from mining coins to mining minerals. They're in the right region already.

jabbany6• 5 years ago

In theory yes, but in practice it's rather infeasible to do 51% attacks IRL --- the main constraint is the people not the math.

A 51% attack mainly lets you double spend, so you have to: (1) get a lot of coins and spend them on something (2) start mining a fork where that spending didn't happen (but other real transactions continue to happen) --- your hash power will now need to be dedicated to this new fork at the exclusion of the old "real" fork since all future hashes will diverge (3) wait until the thing you paid for with coins can no longer be "taken back", all while continuing efforts on the alternate fork (4) do the 51% attack to swap out the old "real" fork with your new fork where you never bought the thing, thus keeping the thing _and_ the coins you spent on them (5) all this needs to be balanced with the opportunity cost had you just continued mining on the real chain...

Such an attack would trigger immediate attention since at (2) the main chain would suddenly see a drop in contributions. Also realistically most things you can purchase with coins (like fiat or other goods/services) can be relatively easily "taken back" unless a considerable amount of time is spent to launder them --- say if you "buy" a car with crypto and reverse the transaction, what you've really done is just stolen a car with a lot of extra steps... Which means your only real viable path is to redeem for some other cryptocurrency... Now given that a big attack just happened on the largest market cap crypto, there's a pretty good chance the other coins are going to take a hit and exchanges might even temporarily limit activities while this situation is "investigated", greatly reducing what you can actually do at the end of the day.

This kind of thing is more reasonable on the smaller market cap "meme" coins where you can just exchange them for for a mass-market crypto.

roofwellhams3• 5 years ago

What if this drop in hash is to use on the 2nd chain?

dehrmann4• 5 years ago

You're thinking too small on the impact--China doesn't need to double spend bitcoins. What they could do is cause a loss of confidence in Bitcoin overnight and collapse the price.

RobLach• 5 years ago

Why would they be "taken back"?

If the the majority of the network agrees on the the new fork who is to say that isn't the de facto "real" fork?

deschutes• 5 years ago

Undermining trust in bitcoin is a plausible goal. An attacker with that goal wouldn't stop at one attack.

lottin3• 5 years ago

can be relatively easily "taken back"

This assumes the existence of a legal system with coercive power, which bitcoin doesn't have. That was the point of bitcoin to begin with, in fact.

emerged2• 5 years ago

I like how the replies are either yes or “yes, but <12 paragraphs of but>”

Zamicol• 5 years ago

Yes.

sashimi-houdini2• 5 years ago

Yes it does. And if/when a large enough player finds it in their interest to mount such an attack, they might very well do it. See https://www.crypto51.app/ for a (somewhat outdated) price chart.

Remember the first law of cryptocurrency though: "in case of emergency, betray your core principles."

In the event of such an attack, the rest of the system (miners, developers) may be able to simply declare the "evil" side of the fork "untrue" and hardcode the other fork as true. The fact that this is exactly opposite to Bitcoin's stated goals is no problem at all. See e.g. Ethereum's response to the "DOA Attack" as an example.

usrusr• 5 years ago

I've been wondering about possible subtle benefits hashrate dominance could bring other than double spending. I'd be surprised if there wasn't some way to benefit nicely from being able to load the dice of which transactions are committed and which have to wait for some minority miner to win the race? Certainly nothing on the scale that it would pay for the hashrate by itself, but that's already covered by regular fees and reward.

de6u99er• 5 years ago

Power outages could be qctuqlly used as a tool to localize miners.

impulser_• 5 years ago

Is bitcoin really decentralized if mining and nodes are centralized?

anonytrary2• 5 years ago

No. True decentralization requires proof of person. Proof of work, stake, capacity, etc. all make it possible for a single person to buy their way into higher voting power.

runeks5• 5 years ago

You can always buy people’s votes. Regardless of who holds the voting power.

xiphias2• 5 years ago

Decentralization is not a binary choice, as 100% can't be achieved.

At the same time price action over the last 10 years show that it may be decentralized enough to survive and.succeed.

lottin3• 5 years ago

They never said what "decentralized" meant for a currency, so it basically means anything you want.

New_California5• 5 years ago

Bitcoin is meaningfully decentralized because miners alone do not decide the fate of Bitcoin - there are also users, businesses, and developers as major actros. The 51%++ actor cannot kill Bitcoin, only cause inconvenience. The worst that could happen is a successful DoS that would force a hard fork to another PoW algorithm.

PS1 The full nodes are actually very well decentralized.

PS2 The physical hash power is skewed towards China, which is not ideal, but it tends to decentralize to US, Canada and to lesser extent other countries. It is improving.

akira2501• 5 years ago

How much of that still holds true after all 21.6 million coins have been mined?

oefrha5• 5 years ago

A good reminder that Bitcoin runs on cheap renewables is BS. See also miners buying gas power plants in New York.[1]

[1] https://news.ycombinator.com/item?id=26828479

mr_woozy• 5 years ago

sure if you're suddenly not counting China's hydropower as renewables suddenly.

soperj2• 5 years ago

Depending on what's flooded Hydro can actually be the dirtest power out there. There's a hydro plant in brazil that contributes 3 times the number of ghg emissions as it's equivalent coal plant.

oefrha5• 5 years ago

- Unless I seriously misinterpreted the news, the significant chunk of hash rate cut due to this blackout is all coal.

- Until hydro and other renewables cover all electricity needs, crypto mining hogging hydro just pushes other non-crypto power demands to fossil fuel.

bonestamp25• 5 years ago

Also a good time to point out that there are energy efficient blockchains that work differently from bitcoin -- not all crypto is as power hungry (some use disk space, or memory, or even just the tokens themselves to replace bitcoin's proof of work model).

pmlnr• 5 years ago

So point them out, please. One that is efficient on all levels.

runeks5• 5 years ago

That’s true. But it’s important to point out that proof-of-work (PoW) is more decentralized than e.g. proof-of-stake (PoS).

For example, with PoW you only need a single honest node to arrive at the correct chain during initial sync. With PoS there is no such guarantee, since there’s no inherent way for a new node joining the network to decide which chain to pick when presented with two different, but equally valid, chains.

bogomipz• 5 years ago

Could you or someone else say how the model that uses the token itself to replace the "proof of work model" works? Which crypto(s) is using this model?

lofi_lory8• 5 years ago

Heat generation really is the stupidest way of doing things. With things like storage, at least you can reuse it after the fact.

Tho, all these systems require some ressource scarcity and will inherently maintain/promote scarcity. This is completely unacceptable in the coming years. People don't realize how much we need to cut back on natural ressource extraction and energy expenditure. Out whole world is build on massive mineral and energy debt. E.g. natural cycles do not allow for biomass generation for food and energy on today's scale. It's simply impossible, the math doesn't check out. See peak phosphorus or dive into the viability of bio-plastics. If we don't tap into some unlimited energy source soon, we have to massively cut back in everything we consume. It's madness to use any unnecessary energy or resource on crypto finance, when there are more energy efficient alternatives.

bko• 5 years ago

Also a good time to point out just because a product is technically superior doesn't mean it'll be adopted if it relies on network effects. There are a lot of sleazy heavily pre-mined crypto assets that are basically pump and dump

rscho• 5 years ago

The only energy-efficient blockchain is no blockchain at all. Storage is not free, and you can't do without it.

New_California5• 5 years ago

The goal is to maximize immutability, not minimize energy usage. Energy expenditure is what roots Bitcoin in reality and what protects against changes (you would have to expand even more energy to change).

Other blockchains are relatively easy to mutate and hence not good candidates for the World's reserve currencies.

wyager5• 5 years ago

No scheme besides proof-of-work provides the same security guarantees as proof-of-work. Proof-of-stake, the most popular alternative, is vulnerable to attacks like “grinding” because casting conflicting votes doesn’t cost anything. The end result is a much less secure cryptosystem. Attempts to address this are still under active research, and may not be possible at all.

nscalf• 5 years ago

To call out one I heard about recently, Chia is doing proof of space and time. Computationally heavy to set up a “plot”, like 6-8 hours of work. Then virtually zero overhead unless you’re chosen as a “winner”.

jlrubin• 5 years ago

running on energy v.s. running on oligarchy.

I don't love the energy use but let's not make a false equivalence.

sleavey• 5 years ago

Has anyone tried to calculate the energy expenditure of the fiat currency system as a comparison, ideally per "unit worth" (whatever that might be) since fiat still vastly outcapitalises cryptocurrency?

runeks5• 5 years ago

Yes, and it’s vastly less than Bitcoin. Simply because it’s centralized, and a centralized system is always more efficient than a decentralized one. It’s a well known trade off.

A better comparison would be gold versus Bitcoin, as they’re both similarly decentralized. Just comparing energy consumption between the two probably wouldn’t make sense, though, as gold mining e.g. ruins vast areas of land.

globular-toast3• 5 years ago

I'm not sure. The trouble is you're comparing apples to oranges. On the one hand you have money which, while not essential for civilisation, is generally agreed to be a good thing. On the other you have this thing that absolutely is not money by any stretch. How do you possibly calculate how much value each of these adds to society?

NoOneNew4• 5 years ago

https://digiconomist.net/bitcoin-energy-consumption/

They have an extremely detailed explanation and process to determine the footprint of Bitcoin transactions.

Anyways, they also have the numbers for Visa based transactions, which can start to give you an idea how efficient the old system of digital transactions are. Its 980,000+ Visa transactions to equate the energy used for 1 bitcoin transaction.

tomxor• 5 years ago

Not only are fiat currencies cheaper, they are also useful... Bitcoin is no longer a practical currency, so comparisons to fiat currencies are pointless.

NicoJuicy2• 5 years ago

A good reminder that bitcoin is mined by 51% chinese miners and that it's not that decentralized, obviously.

herbst3• 5 years ago

A reminder that blockchain is public and 51% attacks would be visible.

inshadows• 5 years ago

Hopefully, rest of our economy has rested on green power for last hundred of years. Oh wait...

cortic2• 5 years ago

The ability to turn electricity into money is not the problem, or if it is, then lump all of modern endeavors in capitalism alongside of Bitcoin.

The problem is we (the world) are not effectively taxing carbon emissions. Right now it should be unprofitable to use coal or oil energy. If this was done right, Bitcoin would be a massive stimulus to renewables.

betterunix24• 5 years ago

How is Bitcoin a boon to renewables? Bitcoin consumes energy, and that energy is not being used for other things. Taxing one form of energy will just mean everything that uses energy becomes more expensive; Bitcoin fees would rise or mining operations would simply move to places without the tax.

The actual problem is that Bitcoin's incentive structure works against energy efficiency. Usually we would expect to see improvements in technology result in reductions in energy consumption. Instead, when a new hashing machine is built that computes the same number of hashes for less energy, the response from Bitcoin miners is to compute more hashes using the same amount of energy. That is what Bitcoin incentivizes, and that is why Bitcoin will always be an environmental catastrophe even if we only had renewable power sources (take a look at the environmental cost of producing a solar panel -- there is more to the environment than carbon emissions).

ravenstine• 5 years ago

That may be true, but the toothpaste is out of the tube. If we can't abruptly stop the use of fossil fuels to stop climate change, I don't think any amount of pointing out how much energy BTC uses is going to change the fact that it's been well established.

paulgb• 5 years ago

Although I believe it is well-established, there's still a lot of people spreading industry talking points about how it's mostly renewables, in spite of stories like this to the contrary. Motivated reasoning is a helluva drug.

tim333• 5 years ago

But you can talk people into selling BTC and buying ADA or some other proof of stake coin.

I think if pension funds etc go into bitcoin it'd be an environmental disaster so it's probably worth campaigning against that. The energy consumption comes out kind of proportional to the bitcoin price.

maerF0x03• 5 years ago

A very large amount (something about 25-47% [1]) of homes use electricity without getting any computation for their electricity to heat conversion. Those homes could use computing devices (albeit at a high capital cost) with 0 marginal energy or environmental cost. Especially if their device is a sunk cost. Yes heat pumps are better than 100% efficient, but they're inappropriate in many circumstances, and can be as expensive as ASIC miners, but it seems that miners also have a much better ROI (~1-2yrs payback) than the energy savings a heat pump would give (~5-10yrs payback).

This ROI could be then funneled into carbon offset projects, renewables, and research.

[1]: A quick google brought up a few results spanning those ranges

CogitoCogito• 5 years ago

This ROI _could_ be funneled into carbon offset projects, renewables, and research.

They could also just take the costs that would go to ASICs and instead put that into the investments in the first place. What actual utility is there in some mathematical computations for society as a whole?

imtringued3• 5 years ago

Let's assume that this is true and there is a way to leverage waste heat from mining perfectly. This would reduce the cost of mining and the savings can be invested into more mining.

jude-16• 5 years ago

A friendly reminder that PoW runs just fine on 100% renewables. It's the job of regulators to make sure all PoW runs this way. Just like it's the job of regulators to mandate renewable energy for literally all other industries.

acidburnNSA2• 5 years ago

Why 100% renewables? Biofuel is renewable but also emits lots of carbon and air pollution. Nuclear is not considered renewable but is low carbon and clean air. Seems like the the term allows undue wiggle room. Might want to require that it be generated with energy that emits less than 50 gCO2-eq/kWh on a lifecycle basis or something more specific.

semicolon_storm• 5 years ago

I thought one of the touted benefits of bitcoin (and other DeFi) is the resistance to regulations?

Sort of seems counterproductive to say that regulation will fix the issues with the currency that's supposed to resist regulation.

ffggvv• 5 years ago

how would they do that practically? would require a huge surveillance state with constant monitoring to make sure you’re not mining on non allowed power

hudon5• 5 years ago

“Runs fine” doesn’t mean it’s energy efficient. If we can get whatever value out of a payment system with 1 wind turbine instead of 10,000, the former is obviously a better choice. And right now it’s not obvious that PoW provides anything that other technologies can’t. Bitcoin itself has shown that when PoW doesn’t produce the results people want, developers can just release code that makes users ignore the most work chain... so the system ends up just as political as any other money system, and PoW is just a clever trick to fool investors into thinking there’s some magic “decentralization” going on.

dehrmann4• 5 years ago

One of the reasons I'm bearish on Bitcoin in the long term is there are systemic risks like this around miners.

RotaryTelephone• 5 years ago

My family has been bearish on the dollar since the 70s. I'm typing this from a computer at a local library.

dehrmann4• 5 years ago

Even if you're bearish on the dollar, owning assets is still reasonable, and most millionaires don't just hold cash. Real estate (foreign and domestic) and equities have done will since the 70's.

The other difference is Bitcoin is less like a currency and more like baseball cards in how people are using it. It's already failed as a currency because its price is too unstable.

New_California5• 5 years ago

Systemic risks in Bitcoin do exist but primarily around fungibility and privacy.

Risks strictly related to PoW, hashrate volatiliy, or "51% attacks" are not existential by any means. We do know how to mitigate them and multiple examples exist how altcoins managed to survive such attacks.

zoshi2• 5 years ago

Bitcoin's hash rate has always been volatile, and it doesn't cause problems. Look at the raw values at <https://www.blockchain.com/charts/hash-rate>.

loceng2• 5 years ago

Indeed, though it's a nice flex/wink to show their current CCP controlled Bitcoin mining capacity; Peter Thiel's stated dislike of Bitcoin is for exactly this reason, international security and integrity.

CyberDildonics4• 5 years ago

Doesn't cause problems? The average cost of a single transaction is over $50 now.

The cost of a single transaction is the same as a hard drive that could store the entire bitcoin chain 4-5 times over.

https://bitinfocharts.com/comparison/bitcoin-transactionfees...

everfree• 5 years ago

The cost of transactions is not directly related to hashrate in the way you imply.

zoshi2• 5 years ago

Transaction cost isn’t determined by hash rate. The difficulty adjusts to the hash rate such that a block is mined every X minutes. Because the block size is fixed, transaction fees are determined by the market for being included in a block, so the more transactions the higher the fees.

An alternative to Bitcoin’s fixed size is Monero’s adaptive block sizing. Monero blocks expand to fit more transactions, resulting in lower fees and higher throughput.

kaliali• 5 years ago

Use proof of stake coins like Cardano and Polkadot

They use 10000 to a million times less energy than bitcoin to process payments!

ilaksh• 5 years ago

Polkadot is terrific and has a place, especially in private blockchains.

Cardano is interesting but much less inspiring to me.

But I still think that Ethereum 2.0 will be the public blockchain of choice down the line.

companyhen• 5 years ago

Don't forget about Kusama. Expect Chaos... ;)

asenna• 5 years ago

Genuine question, what do you mean by "use Cardano"? Use it for what? Can I create borrowing/lending decentralized platforms?

Can I launch my NFT marketplace on it (at this moment)? Or perhaps create a DAO for the governance of a Dapp?

I don't understand how Cardano is even a choice right now.

goblin89• 5 years ago

I know it’s a flawed analogy, but considering the influence China has on Bitcoin, on some level buying into Bitcoin seems not unlike shorting the US dollar.

nlitened• 5 years ago

If you live in the US, your real estate is in the US, your salary is in US dollars, and your pension is in US stocks, you are already pretty deep in long US dollar. Might as well diversify your egg basket a bit, just from financial risk management perspective.

herbst3• 5 years ago

Compared to CHF the dollar looks like a sad piece of currency for the past months and even years. So shorting USD sounds like a pretty good idea

andxor• 5 years ago

Shorting the USD seems like a pretty good idea given the insane amount of money printing.

sunsipples• 5 years ago

frustrating that the ongoing use of bitcoin is never going to require less power. transactions take ages because of how much work is required to update the chain.

when the imaginary currency goes away, maybe we can move onto something more efficient like giant rocks with holes drilled in them?

jbverschoor• 5 years ago

Didn’t Enron do this too?

joering2• 5 years ago

Can some explain what's happening better than I understand bitcoin? Wouldn't the idea that there is less miners be a positive for the price point? Supply and Demand? I mean if you have market of frozen orange juice, and they announce dry season will produce LESS juice, the price will skyrocket. So wouldn't less miners for something like Bitcoin with hard set limit of coins, be a positive for its price?

fuzzybear3965• 5 years ago

IANACryptoExpert, but:

The production rate of BTC does not depend on the number of miners as long as there's one miner (with zero miners no BTC is produced). A block is produced every 10 minutes by a computer that produces the smallest hash for a randomly arranged set of inputs (transactions and previous block's hash). This lowest hash serves as an identifier for that block and all input transactions are recorded on the new block with that hash and appended/linked in the chain. Currently, each mined block is associated with a miner reward of 6.25 BTC (I think) that's given to the computer which produced the lowest hash. It doesn't change if there are more/less miners in the network. So, there's no "dry season" just because the mining rate cut in half. There's just less energy being spent competing to generate the lowest hash and get block rewards. So, all the miners not running are failing to potentially earn money and the system is, theoretically, less decentralized, now.

But, there's no change to the rate of production.

mshumi• 5 years ago

Fork BTC to Pure Proof of Stake consensus. Balances mapped 1:1. No Environmental problems, no scalability problems, no latency problems. It's not a question of if this fork happens, but when.

Bitcoin mining hash rate drops as blackouts instituted in China

Related Stories