Silliness

Why does the world spend so much on rat poison?

Earlier this month Warren Buffett called Bitcoin “rat poison  squared”.

A report by a PwC economist says Bitcoin miners are currently using 2.55 GW of electricity to create  new Bitcoins.

You can add at least another 1 GW to that for the production of chips used to mine crypto-currency chips. 

The biggest producer of  crypto mining chips is TSMC – it is said that a tenth of its revenues come from crypto mining ICs which presumably means that a tenth of  TSMC’s total 10 GW electricity usage goes into mining crypto  chips. 

So we now get to a figure of 3.5 GW for crypto-currency production which is more electricity than Ireland uses.

Could there be a clearer indication of the silliness of the way we live now?


Comments

17 comments

  1. In my imperfect understanding there is, robetc.

  2. Is there an infinite supply of Bitcoin currency?

  3. That explains it, zeitghost

  4. Fascinating, abfg, thanks.

  5. Thanks for that, SEPAM, so Bitcoin mining is using the output of three and a half large nuclear power stations. Astonishing.

  6. Well Duncan, Warren Buffett is not so keen on gold. He says: “If you go back to the time of Christ, and you look at how many hours we had to give up in order to buy an ounce of gold and you bring it forward to now, you’ll find the compound rate may be a tenth or two-tenths of 1 percent.”

  7. Some years ago I saw a program in which the manager of a Gold mine said that their profit margin was only about 10% due to the running costs of the mine. The difference is that gold that was mined thousands of years ago has retained its value and if not used as a store of wealth has other useful applications like on connectors.

    In contrast Tulip bulbs at my local garden centre are plantiful and cheap although they obviously have some value, again reflecting the cost of growing them and shipping them there.

    Tulips, Postal Reply Coupons, or Bitcoin. The question is which will turn out to be the best investment ?

  8. I am as in the dark as you Martijn, but the PwC guy says Ireland uses 3.2GW if that’s any help.

  9. I have no feeling for how much 3.5 GW is. How much energy do we use in total? Wikipedia tells me 19,504 TWh in 2013, which tells me 2 things, 3.5 GW is nothing major, and units of energy are still hard 😉

    • Try gridwatch.templar.co.uk

      Generally the GB grid requires somewhere between 25GW (the still of the night) to 35GW (peak afternoon use). In other words we can choose between powering roughly 1/10th total GB needs ‘right now continuously’ or mining bitcoins. I would imagine the energy could be more productively used. In essence these people are turning pure energy into pure ‘value’. (Energy value and ‘value’ value may fluctuate!!)

    • SecretEuroPatentAgentMan

      1 GW is of the order of what a large nuclear power station produces. If you use gas for heating/cooking, it goes a long way. If on the other hand you use electric heating and you have power consuming industries such as aluminium refineries it is not much.

  10. Fancy a punt, SEPAM?

  11. SecretEuroPatentAgentMan

    I just hope there will be a lot of cheap FPGA based mining rigs available soon.

  12. Ah, good well that’s all right then, zeitghost, if we’ve always been silly and survived so far then maybe silliness doesn’t matter that much. I feel reassured.

  13. This is a combination of the shoe event horizon (Douglas Adams H2G2) and “The Subways on Tazoo” (Colin Kapp).

    The latter being the tale of an alien race who needed so much power that they chopped all the trees down to make electricity generators and then died out in an environmental collapse caused by chopping all the trees down.

    I think the shoe event horizon speaks for itself.

    Doomed etc.

    ‘Twas ever thus.

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