Topic: Bitcoin mining pointless? (Read 15983 times)

Not quite, there is no such thing as a perfect free market ... as there is no such thing as an perfectly unregulated internet ... but in the same way as the internet, the free market will not be denied and sees regulation as a threat and provides work arounds ... we have gray and black markets to compensate ... and heavily regulated markets just move risk to other markets and sectors until they go bust ... and the free market gets established again .... spend some time to examine closely what happened to trading of goods and services and money in the soviet socialist eastern bloc countries ... it took quite some time but the free market was re-established, with avengence.

The only alternative is violence.

No such thing.

Well here's your problem right here ... if your believe this fallacy you're fecked right from the start.

Money facilitates the allocation of resources and capital in a free market which amazingly provide people with a greatly increased number of the necessities of life.

Money is in essence an information technology, it passes pricing information in a fast, efficient and distributed manner, such that the producers of the "necessities of life" can make correct decisions regarding supplies available and existing demand.

Having a pet anti-fetish against money, the technology, is like being opposed to Windows Server Edition. Write a better one if you don't like it, try not to turn into a political crusade, you'll be disappointed and wrong for a long time since it is an information technology.

Well, you are technically correct. The "point" of currency is to deny people the necessities of life. I just don't agree with that goal. Also, when people use the term "utopian" to describe the goals of the Venus Project, they often don't understand what is really being advocated or are trying to attack the idea outright. We advocate no utopia of any sort. There are enough resources for all people to live right now, we just choose to serve the monetary system instead of eachother.

All currency is pointless?! I disagree. A currency system serves to facilitate the trade of products, services, and property in an economic system based on scarce or limited resources. Currency would be pointless if we can have everything we want when we want it how we want it..ie if we had unlimited resources. Currency also serves as a unit of account and a method of tracking "who gets what" and "how much" depending on how useful their services are to the rest of society (ie how much society values their contribution - this being totally subjective but that's besides the point).

Just because the current monetary system is corrupt and faulty it does not necessarily follow that ALL currencies/monetary systems are pointless.

I see that you're an advocate of the Venus project, so I think I now understand why you made that assertion. No doubt from the point of view of the proponents of the Venus project currency is pointless because they believe that the application of technology can bring about a Utopian society where money will not become necessary because we can all have what we want. But my major gripe with this idea is that it's not realistic because the Earth does not have unlimited resources. If we were a space based society then it would be a different game. In space we truly can have ALMOST unlimited resources. But I am digressing here.

Also without currency the society you live in would not have developed. Currency is better than NO currency.

All currency is pointless. Unfortunately we live in a society dominated by a monetary system. Until that changes, vast amounts of resources will be wasted in service to such systems. Bitcoin is much better than the other currencies we have today, but that does not make it any less pointless.

I'm very new to this entire concept, but for what specific reason has the gold rush "peaked" in your opinion? Aside from the fluctuations of the worth of bitcoins themselves, what variable determines the longevity of mining's profitability? Is the end of this "gold rush" simply a result of new miners driving up the difficulty?

pretty dang high-falutin' buncha three-dollar words there, boys...

"Bitcoin mining pointless?"

making some money, honest and fair.

works for me...

There is a positive externality to Bitcoin mining.

It drives up energy costs, hastening the end of fossil fuels and the adoption of renewable energy.

I think you are missing the point. Things have value because humans perceive them to have value.

The so called "real" money at your bank are also just ones and zeros on a computer. HOwever, it's much worse than bitcoin. The only way new USD or Sterling can by created is for the Government or individuals to borrow their own currency into existence from international banks.

Thus the private banking cartel is able to create money from nothing and profit from the interest thereof. Indeed the whole income tax system it can be agued is a necessary evil to fund the government bond market. This is where *your* (and your children's) future income and wealth are pledged as collateral for government loans.

In our system money IS debt, and the only way to pay off the debt is to issue more money which means even more debt. This is why in the UK despite having grown our GDP by 400% since 1980 we are being asked to work *even longer* before we retire. This is because any increase in GDP is met by a concomitant increase in debt. If you think this is insane...it's because it is.

Bitcoin is not just some scam to make money, it is also an attempt to take away the power of corrupt central banks and governments. Bitcoins are debt free money that *the banks can't control*...think of it as daylight spilling onto the vampire squid of banking.

check out money as debt on youtube for an interesting look at fractional reserve banking.

I suggest you offer a bounty in the Project Development forum.

Perhaps we can give people a choice whether to run this alternative mining work. As long as the having two proof of work mechanisms does not cause any conflicts it would be interesting to see how many people would opt in to do this other proof of work.




Yep I agree. Discussion is always a good thing, and what happens I guess will happen.

So, what do you folks think would be the best idea for an alternative proof of work job to set our miners to?

I think you are right. The thread title is a bit misleading and perhaps it should be changed. So in a sense the OP wants the proof of work mechanism to perform some function that not only is of value to the bitcoin network but also have some external positive social benefit. I think the idea is noble in and of itself but what on deep inspection it may be a bit impractical and difficult to implement technically.


The question is who decides what should count as "useful" mining? How do we go about changing the nature of the mining work (hence the nature of the proof of work mechanism) on the fly when it is decided (by whatever mechanism) that the current mining work is no longer useful or is not bearing fruit. Will changing the mechanism cause incompatibility issues in the network. Will altering the mining work somehow "centralize" the decentralized nature of the bitcoin currency (reason being something has to tell each miner what new type of work is required of it - that something would most likely be a single server or cluster or some single entity)?

Also what if changing the mature of the mining work creates an added value? Whom stands to benefit the most from this added value service? Humanity as a whole or a specific group of individuals or corporation or vested interests? Let's take for pharmacological computational work? Who will benefit from any potential discoveries that come as a result of this mining work? Who own the rights (and therefore profits) to any beneficial discoveries that come about as a result of the mining process?

These are all questions that need to addressed. Sure it sounds noble and it would be *nice* if the mining process resulted in something of benefit to everyone. Lol I think at that point bitcoin would become backed by altruism in as sense - I'm joking of course.  

Also am I mistaken but shouldn't the ideal currency have absolutely no tangible benefits whatsoever? After all we don't use water as money do we? Gold is not the ideal currency but it very much closely approximates that ideal. Bitcoin in a sense is the perfected ideal currency. I think that bitcoins should have no "benefit" and no inherent tangible value other than that which its USERS give it.

Granted I'm no economist so I may not know what the hell I'm talking about

the problem with your Aztec gold analogy is,
that in the bitcoin-network we need a quick and easy way to verify that you indeed mined real *gold* and not just some shiny rocks.
it doesnt matter for us, if you find valuable sources of water or other useful stuff, important for us is, that the *gold* is valid.

how are you gonna achieve that with useful work?
if you can't come up with a new design (and so far noone could), the community doesn't have a choice.

The only thing that I can think of at this moment that would qualify as an "unexpected improvement" (well sort of unexpected) would be a quantum computer capable of making use of a surprisingly large number of qubits.

Now on to the subject of the thread. I personally don't think bitcoin mining is pointless. I like to think of bitcoin mining as sort of what a stock exchange's transaction processing systems do. They process the necessary transactions of the exchange and in return earn a fee for their work. Miners do very much the same thing. Thus the energy expended as a result of this process is not "wasted" or "pointless" because it is used to accomplished a desirable and absolutely necessary task.

If one argues that bitcoin mining is pointless, that is sort of like saying the energy used by cars is wasted or pointless because it doesn't cure world hunger. Kind of silly way of thinking.

To phrase it differently; No use of energy that results in a personally or socially desirable outcome should be considered wasteful.

Perhaps someone can refine my phrase a bit better. But anyways, I was quite surprised when I first saw this thread because I never quite expected that someone would question the usefulness of one of the KEY and ABSOLUTELY necessary components of the bitcoin system.

Hmm, I wonder if or how easy it would be to upgrade the bitcoin network to use SHA3 in the future. Is SHA256 (aka SHA2) that vulnerable to "cracking"?

This is a very perceptive and useful observation.

The bitcoin miner network is providing a service that it gets paid for (that of maintaining a currency value that can be used in the economy as money). It should not be need to be said here that sound money in itself is an amazing invention that is efficient at distributing labour, good and services in a free market. The economic benefits from having a properly managed money are enormous and should not be underestimated. In free market of currencies the one that delivers the most benefits will win out, currently we have no such thing. We have an elaborate system full of historical kruft and arcane regulations that is dysfunctional as a financial system of resource and capital allocation. It is administered by a facistic elite hell-bent on self-enrichment, at the expense of the proper functioning of the entire global economy. If bitcoin or crypto-currencies in general can right this listing ship they will be cheap compared to how many hundreds of billions that are being thrown into the current banking systems toxic pile of debts to save it, yet inevitably ends up in bankers bonus pay-packet.

Bitcoin offers a model for using a distributed network of computers, each with an individual economic incentive to perform work, and is a step up in evolution over the volunteer grid computing of folding@home, SETI, etc. It can even be said to be the beginning of a time when GPGPU power connected to the network has become a marketable commodity.

Excuse my Wikipedia: "In economics, an externality (or transaction spillover) is a cost or benefit, not transmitted through prices,[1] incurred by a party who did not agree to the action causing the cost or benefit."

What you are describing is the direct consequence of AMD's business strategy, which graphics branch produces parallel computing processors and have decided before Bitcoin existed to widen their driver support to other tasks requiring parallel computing. Confusing externalities with a business plan, that only confuses the discussion. Once more, be rigorous. Unless you are going to pretend to me that miners nor gamers want faster, more power efficient hardware.

Then again this a discussion on semantics. If your point all along was "Bitcoin should be designed to have good impact on the world oustide of being a crypto currency", my answer doesn't change too much: it has no room for such a thing, nor does it users care. The existence of Bitcoin alone is cause enough.


None of these are ACTUAL examples. Just chimeras in your head. My tendency of thinking you're a troll is that you have failed so far to provide anything but speculation when asked otherwise. My insistence in asking for an actual, real life example of your claims is so that you understand the detachment your perception of this project has with the reality of its development. What incentive would one have to spend efforts in researching positive externalities for Bitcoin when building and updating the project unless these externalities have a direct consequences on the project, in which case they are not externalities anymore, are they?

You do understand that to incorporate externalities implies limiting your choice in developmental possibilities by rules that are not directly related to the goal of the project. Which begs the question:


How can externalities be voluntarily implemented if the design choices are arbitrary? Surely if the functionalities the project has to deliver are precise and legion, this will restrict the design choices, which hurts your idea that any precise piece of software is designed on lsd at 4am. This isn't a governmental project afaik.

Is Facebook a crap shoot? Yes. The problematic is far too unclear for a precise developmental line to be isolated. Is h.264 a crap shoot? Certainly not. But somehow you are thinking that there is a lot of leeway in Bitcoin's developement. So again, I'll tell you, the conditions needed to establish a decentralized, currency worthy, virtual commodity are pretty restrictive.


There is no marketing in Bitcoin's, since there is no one selling you access to it. As for self and/or public interest, what is arbitrary about that? This isn't a dc++ vs torrent turf war, it is the establishment of a currency. Again, precise guidelines, known problematics.


None of this. I am being perfectly respectful with you by explaining why you are ignorant on the matters you are discussing, by pointing how detached you are of certain realities of this project. Was I to praise you for them, then I'd be a hypocrite, wouldn't I? To summarize this discussion, you go something like "Hey, cars polute and waste energy by using oil, why haven't you guys built an engine that turns oil waste into pizzas?", then I come in, tell you that's not gonna happen for several reasons that I outline, and you call me a combustion engine jingoist. My stance is the same as someone witnessing a newcomer question a research group on energy about why they're not researching perpetual movement.


Scuse me what? If that company can make a business of selling polluting cars, so be it. The responsibility lies on the consumer, not the manufacturer. No one is forcing you to buy that car, and by buying it and using you are ruining the atmosphere, not the manufacturer. If you only buy clean cars, manufacturers will have to adapt and integrate that to their business strategy. This about as bad as saying guns kill innocents so manufacturers should only sell rubber bullets.

I did a thought experiment that I found illuminating.

Bitcoin mining is a little like gold mining as has been said many times before, except that the work involved in gold mining is not useful, even though it does keep the value of gold high.  The value of gold as a currency is just because it is hard to forge because of this work. But men do die doing it.

Bitcoins, on the other hand, are pulled from the mathematical ether with raw computational power, and if that is a waste, it seems a necessary one.

Why not have a bit coin client that can also do useful problem solving? I thought. Well, actually, why not have such a client that is quite separate from bitcoin, but happens to accept bitcoin as a means of payment of the person running the GPU's?

The answer seems to be that technically we are not quite there yet. And that many people offer free computer power via the folding at home network. But I think this could happen by the time bitcoin becomes mature, and could be an alternative way for miners to spend their GPU electricity.

Would it be better to have an electronic currency based on real useful work, maybe, but in fact it does not have to be built into the currency and in fact probably should not be.