The article starts by establishing that, talking about energy, the author does not believe there are alternatives to Bitcoin that use less energy and “would work”. Then in the rest of the article, the author explains why proof of stake or proof of time and space are indeed more energy efficient and offer similar guarantees towards decentralization.
Isn’t that a contradiction? Leaving aside the fact that the author doesn’t seem to think that cryptos in general “work”, the main takeaway I see here is that, if you want to look for alternatives to Bitcoin (as it is today) you can indeed look into proof of stake, space or time and space. Am I missing something?
Actually, the author states that other schemes like proof of stake or proof or time and space are in fact not helping decentralization, and that the ones with more resources will always have more control, leading to centralization of the system. In the case of proof of stake, more money = more power; and in the case of proof of time and space, more storage space (aka more money) = more power.
Yes, but just after that, the author concludes that proof of work has exactly the same issue:
But what you might not realize, is that this applies for proof-of-work cryptocurrencies too. The frequent claim is that Bitcoin is decentralized and controlled by nobody, but that isn’t really true. Because who can afford to invest the most in specialized mining hardware? Exactly, the wealthy.
Therefore, that is not inherent to proof of stake/time/space. So yes, they don’t help decentralization, but apparently they don’t make it worse either. Something that has the same level of decentralization but uses less energy sounds like a good alternative to me.
What’s worse is that SSDs, GPUs, and whatever other “proof of X” computing substrate you can think of use Rare Earth Elements – in the case of Chia this means Terbium – so aside from the actual resource cost to mine and manufacture the components (There are now global shortages in both ABF substrate and silicon wafers), cryptocurrencies are actually pushing the depletion of rare minerals and transforming them into a mostly-irrecoverable form.
Personally, if I was the sort of person to believe in conspiracy theories, it would be easy to believe that Cryptocoin was a deliberate ploy to get rich in three ways at once. First, by deliberate market manipulation (pump and dump schemes). Second, by running an exchange to profit off the cryptocoin exhange rates. Thirdly, by deliberately buying up SSDs and GPUs en masse, waiting 2 years, and then churning a profit off of the price increase – or otherwise betting against a market decrease and raking in the cash.
The only tangible result for cryptocurrency is that a lot of gullible people lost a lot of money, some random folks managed to triple their wealth, and the rich have got richer.
That’s not really a point, though. Saying that they are as bad as each other still means that they are bad.
The point is: why is decentralization even part of the article (and the discussion attached to it), if it is left unmodified by alternatives such as proof of stake/time/space, while at the same time providing benefits in other areas, such as energy efficiency? Apparently, these alternatives have the same benefits and problems while using less energy, therefore to me, they do look like solid alternatives to Bitcoin we should be using! (if we need to use Bitcoin at all)
Proof of space has already proven economically unviable with chia
Are you suggesting there is something inherent to the proof of time and space algorithm that makes it not economically viable compared with proof of work? Because I don’t see how that could be the case, and if that is indeed the case, I would love to learn more about that!
I feel like you’re thinking I’m some pro-crypto guy that is advocating for everyone to adopt crypto and dump your money there, and that’s far from what I’m trying to share. I agree with everything you posted re: getting rich quick schemes, some folks getting rich on some gullible people, consumer goods rising in price and supply chains disruptions.
I’m just coming from an energy efficiency point of view. The fact is, blockchains are growing and are increasing adoption. People are building projects and business on top of a technology that arguably, is consuming a lot of energy, and apparently there are alternatives that can provide the same features while consuming way less energy. Why not push them and the industry to use blockchains that use less energy? How are people pushing for Bitcoin alternatives wrong? (which is what the article is saying).
Because the entire point of a cryptocurrency is decentralization. The claimed reason they exist is to decentralize the currencies control. If they don’t succeed at that then what is the point?
Uses less energy than what, exactly? Blockchains are more expensive than centralized payment processors, which already exist and handle centralized state currencies. The decentralization is the expensive part; as the number of parties required to acknowledge a transaction grows, the time required for transactions to settle also grows.
I’m a bit confused.
The article starts by establishing that, talking about energy, the author does not believe there are alternatives to Bitcoin that use less energy and “would work”. Then in the rest of the article, the author explains why proof of stake or proof of time and space are indeed more energy efficient and offer similar guarantees towards decentralization.
Isn’t that a contradiction? Leaving aside the fact that the author doesn’t seem to think that cryptos in general “work”, the main takeaway I see here is that, if you want to look for alternatives to Bitcoin (as it is today) you can indeed look into proof of stake, space or time and space. Am I missing something?
Actually, the author states that other schemes like proof of stake or proof or time and space are in fact not helping decentralization, and that the ones with more resources will always have more control, leading to centralization of the system. In the case of proof of stake, more money = more power; and in the case of proof of time and space, more storage space (aka more money) = more power.
Yes, but just after that, the author concludes that proof of work has exactly the same issue:
Therefore, that is not inherent to proof of stake/time/space. So yes, they don’t help decentralization, but apparently they don’t make it worse either. Something that has the same level of decentralization but uses less energy sounds like a good alternative to me.
That’s not really a point, though. Saying that they are as bad as each other still means that they are bad.
Proof of space has already proven economically unviable with chia
What’s even more damaging is that everyday computing resources are going up in cost and becoming unviable for most consumers, to the point that you can’t even safely buy a secondhand SSD anymore, thanks again to Chia. The same has happened with GPUs and is well-documented. In the case of “Proof of space”, this is so extreme that the actual supply chains have become disrupted.
What’s worse is that SSDs, GPUs, and whatever other “proof of X” computing substrate you can think of use Rare Earth Elements – in the case of Chia this means Terbium – so aside from the actual resource cost to mine and manufacture the components (There are now global shortages in both ABF substrate and silicon wafers), cryptocurrencies are actually pushing the depletion of rare minerals and transforming them into a mostly-irrecoverable form.
Personally, if I was the sort of person to believe in conspiracy theories, it would be easy to believe that Cryptocoin was a deliberate ploy to get rich in three ways at once. First, by deliberate market manipulation (pump and dump schemes). Second, by running an exchange to profit off the cryptocoin exhange rates. Thirdly, by deliberately buying up SSDs and GPUs en masse, waiting 2 years, and then churning a profit off of the price increase – or otherwise betting against a market decrease and raking in the cash.
The only tangible result for cryptocurrency is that a lot of gullible people lost a lot of money, some random folks managed to triple their wealth, and the rich have got richer.
The point is: why is decentralization even part of the article (and the discussion attached to it), if it is left unmodified by alternatives such as proof of stake/time/space, while at the same time providing benefits in other areas, such as energy efficiency? Apparently, these alternatives have the same benefits and problems while using less energy, therefore to me, they do look like solid alternatives to Bitcoin we should be using! (if we need to use Bitcoin at all)
Are you suggesting there is something inherent to the proof of time and space algorithm that makes it not economically viable compared with proof of work? Because I don’t see how that could be the case, and if that is indeed the case, I would love to learn more about that!
I feel like you’re thinking I’m some pro-crypto guy that is advocating for everyone to adopt crypto and dump your money there, and that’s far from what I’m trying to share. I agree with everything you posted re: getting rich quick schemes, some folks getting rich on some gullible people, consumer goods rising in price and supply chains disruptions.
I’m just coming from an energy efficiency point of view. The fact is, blockchains are growing and are increasing adoption. People are building projects and business on top of a technology that arguably, is consuming a lot of energy, and apparently there are alternatives that can provide the same features while consuming way less energy. Why not push them and the industry to use blockchains that use less energy? How are people pushing for Bitcoin alternatives wrong? (which is what the article is saying).
Because the entire point of a cryptocurrency is decentralization. The claimed reason they exist is to decentralize the currencies control. If they don’t succeed at that then what is the point?
Uses less energy than what, exactly? Blockchains are more expensive than centralized payment processors, which already exist and handle centralized state currencies. The decentralization is the expensive part; as the number of parties required to acknowledge a transaction grows, the time required for transactions to settle also grows.
Uses less energy than other wide-spread blockchains, like Bitcoin or Ethereum.
Just joined! Every year I end up doing only a few of these but let’s see how it goes this year.