Bloomberg bitcoin mining

Read more: What Is Crypto and Blockchain? It acknowledges some of the ridiculous aspects of crypto culture. They bought Lamborghinis and islands," Levine wrote. And the article notes this might appear to be a strange time for such an opus, with crypto prices down substantially from their peak less than a year ago. Whatever is left in crypto is not just speculation and get-rich-quick schemes.

We can think about what crypto means — divorced, a little bit, from the lines going up. And there's plenty of that to discuss in crypto. The report found cryptocurrency mining accounts for 0. The Energy Department declined to be interviewed about the White House report—it referred questions to the Justice Department, which has no jurisdiction over energy efficiency standards.

Jared Huffman D-Calif. Huffman joined others in hailing the report as an historic roadmap to better understand digital assets. Are they having adverse effects on electricity pricing, water pollution, or noise pollution for these communities? The push for better energy and emissions data is the biggest recommendation in the report, Samaras said during a Twitter Spaces event held by Bloomberg last week.

Have at the line bet thought

Any energy comparison must take the above into account — including the externalities from the extraction of oil, which implicitly backs the dollar. Bitcoin transactions, by contrast, rely just on bitcoin. Bitcoin proposes a new monetary unit also named bitcoin and mediates its circulation through the Bitcoin protocol, which is administered by nodes and miners.

This provides fertile ammunition for critics who can easily estimate the externalities of Bitcoin while insisting no equivalent ones exist for the dollar system. But the two systems are different. Until Visa marshals its own private armies to keep the integrity of the dollar intact, the comparison will be a specious one. Bitcoin is a full-stack monetary and payments system. Visa is a thin layer within the international dollar system, wholly reliant on seamless interoperability of the rest of the payments and settlement pyramid.

If you look at the actual characteristics of Bitcoin transactions as compared with Visa, their differences are clear. To put it simply, bitcoin is simply too valuable for miners to abandon entirely. Once enough of them stop, they will be replaced almost immediately by those looking to cash in on the suddenly lowered network difficulty. For our first scenario, bitcoin is saved by the non-static and ever-changing nature of network difficulty. Scenario 2: Technological Innovation Another aspect of Bitcoin mining that the Bloomberg piece seems to have missed is the simple concept of innovation and technological development.

Less than a decade ago, Bitcoin mining was feasible on any personal computer. Shortly after that, we were met with the current generation of standalone ASIC machines. Is it really fair for us to judge what future miners will do if we assume essentially nothing will change with mining technology? Such chips will greatly reduce energy consumption, as well as increase mining computation speeds.

As the chips have yet to hit the market, the effect of such technology is still yet unknown in the mining community. The GMO chips are just one example of what could be possible. Dozens or hundreds of other research and development projects could be working towards new bitcoin mining hardware at this very moment. We would be highly foolish to assume that the current form of terahash range S9 style miners and their ilk represent not only the present but also the future of mining as well.

Mining will get more efficient. Petahash and even exahash miners are inevitable. If BTC really becomes that valuable, and mining difficulty continues to climb, where exactly is the problem? Bitcoin mining is a business and all businesses have expenses. The larger a company becomes, the larger their expenses will become. At the same time, a larger company will earn a larger income. Bloomberg is essentially saying no, miners would turn down that deal. We also need to consider the future valuation of BTC.

How will that affect long-term profits of professional miners who mine and hold a portfolio of bitcoin assets? However, the author makes yet another critical mistake in their assumptions — that Bitcoin is a monolith, a company, a place with a headquarters and a CEO that makes coordinated decisions.

The article asserts that if Ethereum switches , Bitcoin will follow suit. Such a decision, if it were ever to be made, would need to be done by the community of miners, node operators, and stakeholders.