Of Numbers

Ah, I love how people love to paddle flawed ideas in order to protect their mindset. This article goes into great depths to explain all the fallacies when it comes to energy and bitcoin: https://www.ofnumbers.com/2021/02/14/bitcoin-and-other-pow-coins-are-a… tl;dr is that bitcoin is just wasting energy and no amount of text will help improve that situation. It should be outright forbidden.

I think you’re on track. I found this article to be a great analysis of the electric consumption as it relates to the price of BTC. https://www.ofnumbers.com/2021/02/14/bitcoin-and-other-pow-coins-are-a…

As a crypto fan, I try to pay close attention to the critics. Its tough to find someone who understands the tech and doesn't think it has some chance of success. Having said that, Tim Swanson has some good critiques of bitcoin/blockchain. http://www.ofnumbers.com/ He does work for R3, the banking consortium which isn't creating blockchain technology, but distributed ledger technology.

"Blockchains never shut down" Yes, they do. See this long list of failed altcoins.[1] Minor cryptocurrencies can fail in some unexpected ways.[2] The classic 51% attack has happened in practice to several altcoins.[3] There's also a "burst mining" attack, which can happen automatically - a big mining pool's control system determines that it would be profitable to divert the pool to briefly mining some altcoins and get all the blocks for a while. Then the difficulty goes way up, and the big pool goes off to do something else. Now the difficulty is so high that no blocks get mined at all for a considerable period of time and transactions stall. [1] https://bitcointalk.org/index.php?topic=588413.0 [2] http://www.ofnumbers.com/2014/06/03/thread-of-the-day-list-of-all-the-… [3] https://maxminer.files.wordpress.com/2013/06/ftc_51attack.pdf

If you google search "how much power is used by online banking" there are multiple analyses answering this question for you along with consumption estimates for Bitcoin. One pro-bitcoin one from my first 4 results attempts to estimate all the power consumption for every bank server, branch office, and ATM 24/7 around the entire globe and produces an estimate of 140TWh/yr vs bitcoin's (at the time) 32.56 TWh/yr estimate. You can compare their average transaction values for yourself to decide how favorable this comparison actually is for bitcoin. An article I read today provides a comparison point for realtime transaction processing, Fedwire, along with its transaction volumes and server count. It's interesting to compare that with Bitcoin's volumes. The article also makes claims about the energy consumption (suggesting FAANG's energy consumption is already dwarfed by Bitcoin) but I can't manually verify those myself: https://www.ofnumbers.com/2021/02/14/bitcoin-and-other-pow-coins-are-a… The above article estimates a best case total of 55.1 TWh/year for the major Proof of Work chains, and also provides estimates for various types of mining equipment, etc.

> While there is a market for those txns the reality is that most adopters, and they recognize themselves as early ones, today, buy bitcoin as an inflation hedge. That's my point - bitcoin is most useful for those who wish to engage in illicit activity (this accounts for at least 10% of bitcoin's market size if not more [1][2][3]) and for those who have ideological reasons to support it. Those who have ideological reasons to fear inflation and support bitcoin are primarily libertarians, who think of inflation as Satan incarnate and view it as worse than murder and only slightly better than outright theft. But that's hardly a consensus view. Beyond those two groups, bitcoin has no real use. I'm not saying bitcoin is worthless, I'm saying that there's a natural peak to its valuation based on its limited use cases (see above). Maybe bitcoin will make significant inroads in developing countries, and maybe then those $100 billion+ valuations will become reality, but I doubt it. [1] https://en.wikipedia.org/wiki/Silk_Road_(marketplace)#Sales [2] http://money.cnn.com/2016/04/15/technology/ransomware-cyber-security/ [3] https://bitcoin.stackexchange.com/questions/47942/what-percentage-of-b… [4] http://www.ofnumbers.com/2015/04/22/the-flow-of-funds-on-the-bitcoin-n…

You know you're on a programmer's blog when this is the site hero image they choose: http://www.ofnumbers.com/wp-content/uploads/2013/03/cropped-GWON-banne…

I think looking at transactions is a reasonable metric. In fact, even this metric may be overstating things. Tim Swanson has analyzed transactions excluding popular addresses (apparently this excludes things like SatoshiDice) to identify transactions that are positive-sum in an economic sense and then the numbers look even lower. [1] Another factor to consider is that if you count purchasing power transferred (which I assume means dollar value times transactions) you'll end up giving a lot of weight to events like when coinbase/mtgox moved their coins from one wallet to another. [1] http://www.ofnumbers.com/2014/06/23/separating-activity-from-growth-on…

Tim Swanson has a really good post on this http://www.ofnumbers.com/2014/03/04/chapter-3-next-generation-platform…

please make sure you read: http://www.ofnumbers.com/2013/12/18/charles-stross-takes-on-the-bitcoi… It will hopefully make clear that your argument is flawed.