When the Enviromarxists Come for Bitcoin

Every time the Bitcoin price jumps a swarm of kombucha drinking hipsters flock to Vice to take stabs at writing hit pieces on the energy consumption of Bitcoin.

Bitcoin is back in the spotlight these days thanks to some wild price movements and central bank meetings. The decentralized currency has recently been trading over its all-time high of $1200 on some exchanges. But the higher the price goes, the more it exacerbates bitcoin’s dark side: shocking levels of electricity consumption.

Daniel ShaneVice - A Single Bitcoin Transaction Takes Thousands of Times More Energy Than a Credit Card Swipe

Odd that you don’t see Vice publishing articles on the “Underbelly of Google,” which consumes about 5.7 terawatt-hours.

Of course, the enviromarxists at CNN have Bitcoin on their hit list too.

Bitcoin uses about 32 terawatts of energy every year, enough to power about three million U.S. households, according to the Bitcoin Energy Consumption Index published by Digiconomist, a website focused on digital currencies.

By comparison, processing the billions of Visa (V) transactions that take place each year consumes the same amount of power as just 50,000 American homes, according to Digiconomist.

Daniel ShaneCNN Tech - Bitcoin boom may be a disaster for the environment

CNN sites the Digiconomist statics which, according to the crypto researcher Marc Bevand, had some serius faults in calculating his Energy Consumption Index. The comments section of the post has an impressive eleven month ongoing back and forth between Digiconomist and Bevand debating the upper and lower bound of energy consumption in mining. Bevand makes a well-reasoned case that the number is closer to 15 terawatt-hours rather than 32 terawatts CNN sites.

Yes, the number of miners increase whenever the bitcoin price jumps, because a higher priced bitcoin means more captured profit for the miners. But there’s also a system of regulation built-in to protect against infinitely expanding miner growth in Bitcoin itself. There is a halving every four years, that halves the block reward available to the miners, reseting with a lower incetive to mine.

Regardless of what numbers you belive. The sustainability of energy is a valid concern, a concern miners share. Because its in the interest of the miners to keep down costs and use the most efficient miners on the market. One of the largest known bitcoin mining facilities owned by BitFury, is powered by a nearby hydroelectric dam. Not all energy is create equal, not all electricity is powered by coal.

An engineer of Etherium Classic and Global Financial Access (a mysterious smart contracting company owned by Nick Szabo) Elaine Ou, provides some useful ammo in the battle of bitcoin energy debate against the enviromarxists.

Global production of cash and coins consumes an estimated 11 terawatt-hours per year, while gold mining burns the equivalent of 132 terawatt-hours. And that doesn’t include armored trucks, bank vaults, security systems and such. So in the right context, bitcoin is positively green.

Elaine OuBloomberg - No. Bitcoin Won't Boil the Oceans

I’ll take the hydroelectric powered Bitcoin over scrapping old electronics from the garbage and dousing them in cyanide for the gold. Thanks.

Understanding Bitcoin Forks. Fork Off.

First, lets take a lay of the land. There are three branches of Bitcoin governance:

  • Nodes: A computer that connects to the Bitcoin network is called a node.
    • Full Nodes: A comupter that downloads newly mined blocks and ensure that all transactions conform to consensus rules, and are also responsible for relaying transactions across the Bitcoin network.
  • Miners: A computer that executes proof of work to create Bitcoin blocks.
  • Developers: A contributer to Bitcoin source code and consensus rules.

There are two ways to change existing Bitcoin law:

  • Soft Fork: Adding rules with a backwards compatible change to the protocol, that weaks security for nodes that don’t upgrade.
    • For example, if an arbitrary rule requires a value must be between 1 and 10 a soft fork could reduce this to require the value be between 1 and 9.
    • For the soft fork to activate, 95% of nodes in the Bitcoin network have to upgrade. When a soft fork is made, all nodes (upgraded or not) continue to recognize new blocks and maintain consensus on the blockchain.
  • Hard Fork: Removing rules with a backwards incompatible change to the protocol, that breaks security for nodes that don’t upgrade.
    • For example, if an arbitrary requires a value be between 1 and 10 and a hard fork increased this to require the value be between 1 and 11 a fork of the blockchain occurs if any blocks are mined that produce a value of 11 while other blocks are still being added to the original chain with its limit of 10.
    • To recognize new blocks all nodes in the Bitcoin network have to upgrade. When a hard fork is made without consensus nodes running the new software separate from the previous version, and blockchain forks into two chains.

Fork terminology are combined definitions from Peter Todd, Bitcoin.org, and BIP 99.

If you were going to redesign Bitcoin today, you would change more than a one or two things. Schnorr signatures, segregated witness, mining pools, the technical laundry list could go on and on. I’m not a developer on Bitcoin, but Rusty Russell is, and he has an excellent technical list of his proposed improvements that I recommend reading here. You could easily make all of the desired improvements to Bitcoin if it didn’t have this pesky thing called an economy.

Bitcoin has its technical hurdles, and the challenge is to overcome them while building on top of the existing infrastructure, without crashing a multi-billion dollar network, without politics.

Believe that if you want, but it is the truth that most of the current developers are interested in Bitcoin as a decentralized consensus system existing outside and above the realm of human affairs. Lose that property, and it ceases to be an interesting system.

I’m passionate about Bitcoin. I have zero passion for majority-vote to change the rules [of the] system. We have one of those already – it’s called fiat.

Say you don’t want to contribute to Bitcoin, your options are:

  1. Start an altcoin: walk away and start over.
  2. Hard Fork the chain: take what percentage of the network that you can and run with it.

In the past, the community viewed the uncertainty of forks as an attack on Bitcoin itself. Fork announcement would cause a price dip, and angry Reddit posts ensue. More recently the opposite trend has emerged. Forks mean free money right? Compared to previous attempts like Bitcoin-XT or Bitcoin Classic, the recent Bitcoin Cash forks has rallied a token value above $0 and incentivized more forks like this in the future.

At a political level, I want a cryptocurrency that isn’t controlled by politicians because that vision was the entire point. At a technical level, I want a Bitcoin that can sit on a piece of hardware, be ignored for five years and still come out Bitcoin, not 1 Bitcoin Cash, 1 Bitcoin Clashic (Yes, Bitcoin Cash just forked), and 1 Bitcoin Gold.

Hard forks without consensus are not Bitcoin.

Okay, but what are users supposed to do about forks?

The first thing to do is to start running a full node.

Looking into the Bitcoin community, there is so much noise, technical jargon, and sock puppet accounts it’s difficult to separate truth from falsehood. Consider what percentage of bitcoin users have tried using the full functionality of the protocol.

User Level Bitcoin Experience:

  1. Buying/Trading bitcoin on an exchange
  2. Sending bitcoin peer-to-peer
  3. Running a full node
  4. Sending bitcoin in command line
  5. Bitcoin scripting (using different transaction types in bitcoin-cl)

Most users don’t ever surpass level two, which is sufficient for owning and using bitcoin. But the lack of widespread use for features like muiltisig or timelocked transactions is a substantial gap between the average user and the developer community. Contentious hard forks exploit the gap between the publics technical understanding and real solutions that are technically viable.

Evaluting Bitcoin Forks

  • Bitcoin Cash launched on the wedge issue of the blocksize debate, claiming that Bitcoin should be more like digital cash than digital gold. Then it launched without a public testnet.
  • The Segwit2X planned fork platformed to counter the adoption of Segwit into Bitcoin, claimed to improve speed and cost of transactions. Developers refused to implement replay protection, functionally opening up users to having coins stolen on one chain after transacting on the other.
  • Bitcoin Gold launched on the wedge issue of decentralization, claiming that Bitcoin would be more decentralized with GPU instead of the current ASIC mining. Yet they launched without addressing the long-term centralization issues of their development, and recently published a critical warning on a “hack” discovered on their Windows Wallet.

Hard forks without consensus look more like elaborate pump and dump scams to buy more BTC rather than noble proposals to improve Bitcoin. None of the forks meaningfully address the technical concerns they claim to solve. They are not designed for longevity, and none of them will exist in five years.

Ultimately the chaos will only evolve users and the community to be more resilient. The crypto space isn’t for regulators, it’s for people who want the freedom and accept the responsibility of managing their own money. Fork scams be damned.

Advice From Grandpa // The Curmudgeon's Guide to Getting Ahead by Charles Murray

Mr. Murry is the man who wrote The Bell Curve, a somewhat controversial study on IQ. Reading the mans book, The Curmudgeon’s Guide to Getting Ahead feels a bit like getting advice from your Grandfather. Not the crazy Grandfather that says the aliens are coming, but the one that talks about how he got screwed over on his pension and is trying to stop the same thing from happening to you. Forget the fact that no one gets a pension anymore.

Some of his advice is more true than we’d like to admit, others are so far removed from culture they’ll be utterly irrelevant by the next generation. These are the few bits of wisdom that were most useful to me.

  • Show up.
  • Leave home.
  • Think of your twenties as a time to do the things you can’t do when you have a wife and kids.

Advice for the Upper & Middle-Class

It’s odd that transitioning between economic classes is so rarely talked about. You’d think that because there are far more people that experience the transition from lower middle class to upper middle class than there are transgenders that move from male to female or Rachel Mendozas that transition from white to black, this would be a more relevant topic.

Murrys advice, get out of your class bubble.

If your an upper-class kid, try getting a real job.
If your a middle-class kid, try getting an internship.

Don’t be like The Babyboomers

Bashing the baby boomers is a tradition among millennials, but Murry gives us a look from inside the 60s. He trolls the baby boomers for their narcissism and consistent juvenile behavior. He blames them for the culture shift away from addressing people by last names to first names, since the baby boomers refuse to do anything that makes them feel like adults.

Try being raised by them Murry. There is nothing like being told how easy it is to get a job or pay for college by someone who paid $500 for a semester and hasn’t applied for a job in 30 years.

Communication in a Multigenerational Office

Chapters include:

  1. On the proper use of strong language
  2. On piercings, tattoos, and hair of a color not known to nature.
  3. Negotiating the minefield of contemporary dress.
  4. Office emails are not texts to friends.
Charles Murray

Don’t be an entitled tweety-something year old. Look at where entitlement got the baby boomers.

Words Matter

The most powerful theme throughout is his stress on learning to think and speak with precision. Knowing what you want to say, and knowing how to express exactly that.

  • Don’t say less if the correct word is fewer.
  • Don’t say continuous when you mean continual.
  • Don’t confuse nice with good.

Recognize that words have distinct meanings and the meaning matter.

  • The difference between, “my pleasure” and “no problem” is perceived in the millipeeves it takes to unpack the subtle disregard in insinuating there was a problem.
  • The difference between good and wonderful is felt in the microcentury of impact you leave with the next person who asks, how are you?