cacheson

Added your instance to the list of specialized instances

"It's a Scam"

I'm not sure if this point is being directed at Bitcoin specifically, or just at cryptocurrencies in general in this thread and in the article that poVoq linked. I'll address it briefly anyway. (The previous two sections are the more important ones.)

Many Bitcoin skeptics have described it as a Ponzi scheme or pyramid scheme. If you read about what these schemes actually are, and read about what Bitcoin is, it should be obvious that it's not a match. Bitcoin isn't centrally controlled, so there can't be anyone filling the role of Ponzi or of the directors, at least not for the entire system. It's certainly possible to run such a scheme using bitcoins, but that's true of any currency.

When pressed, these skeptics will usually say something about how everyone invested in Bitcoin is just looking for some group of "greater fools" to pump the price up so that they can make their exit. Like, sure, maybe some people are like that, but to claim that it's some coordinated scam across all of Bitcoin just sounds like a ridiculous conspiracy theory. There are plenty of people that have had ample opportunity to exit profitably and just... haven't?

Being more charitable, these folks largely see Bitcoin as having no future ("it's a bubble"). If everyone is eventually going to get tired of Bitcoin and give up on it, that does make it a really bad investment. That doesn't make it a scam, though.

Anyway that's enough words, I need to sleep. -_-

I may or may not respond if people want to argue over this. Not something I have a ton of patience for these days. If you're genuinely curious and want to pick my brains though, feel free.

Capitalism

Let's be clear. Capitalism is not money. Capitalism is not market exchange. Capitalism is not "line goes up".

Capitalism is a system of state-granted privileges for owners of capital. Some of these privileges were intentionally implemented, and some likely came about by accident, but they all have the effect of transferring wealth from the working class to the owning class. The state primarily does the bidding of the capitalists. Even though much of the world is ostensibly democratic, when there are policy disagreements between the working class and the capitalist class, the capitalists generally get their way.

The capitalist class does not want "anarcho"-capitalism. It does not benefit them. The state already works for them. Without the state, they lose their privileges. Without their privileges, they eventually lose their wealth, as their megacorporations are incredibly inefficient.

This is not a defense of "anarcho"-capitalism. At best, ancaps are confused. If they were to destroy the state, they would allow the capitalist class plenty of opportunity to recreate it. (And of course, the worst of them are outright mask-off fascists.)

Bitcoin is not capitalism, even if ancaps tend to like it. Bitcoin is not issued by any government. It doesn't require the use of the banking system that they control. They cannot use it to manipulate the economy. They cannot freeze anyone's Bitcoin wallet, nor can they seize bitcoins that are properly protected. The degree to which adoption of Bitcoin diminishes the state's abilities is a matter of debate, but it does impose some real constraints. And in constraining the state, it also constrains the capitalist class. Issuing money is also seen as one of the reasons we "need" governments, so the existence and adoption of Bitcoin deals a blow to that as well.

In the previous section, I mentioned that proof-of-stake introduces a wealth-concentrating mechanism. Proof-of-work, on the other hand lacks this. Unlike with PoS currencies, holding bitcoins does not grant you more bitcoins.

If you want to gain bitcoins through mining, you need to purchase specialized equipment to do so. If done properly you can recoup the dollar cost of the miners, but they aren't likely to produce as many bitcoins over their useful lifetime as you would have gotten from just using the dollars to buy bitcoins directly.

Even in terms of dollar return, you can't just keep buying more miners to gain more dollars compound-interest style. The return on Bitcoin mining always approaches the cost of miners + electricity + labor. There is no guaranteed profit margin.

As for people getting rich off of buying bitcoins, I'm not aware of any indications that there's been a particular order in which the various socioeconomic strata have invested. The early adopters were largely not already rich, as far as I know. A fair number of "old money" types have been skeptical of Bitcoin. Of course, one does need to have at least some amount of disposable income to invest in the first place. Some technical inclination also helps. It may just be a case of "the middle class get rich" rather than "the rich get richer".

Also note that as I touched on in the previous section, the line won't go up forever. The price will reach equilibrium once Bitcoin reaches its "final" adoption level, wherever that happens to be.

Continued in reply

Energy Consumption

This is admittedly the weakest part of my argument. Even if one accepts that the existence of a decentralized digital currency might be beneficial, the energy consumption of proof-of-work is still a real cost, and the benefit needs to outweigh that cost. I think it will become a clear net benefit in the future, but right now things are more hazy and theoretical, as Bitcoin has not yet been fully adopted, nor is its development "finished".

Why use proof of work anyway? Because it's the only way that we've found so far to make a hard decentralized digital currency. Non-hard currencies involve trusting someone else, and that someone can be leaned on by governments, can be robbed, or can be a scam artist themselves. Trust is a necessary part of being a social animal, but it is also useful to reduce the degree to which you are at the mercy of others, particularly when money is concerned.

Proof-of-stake is not a suitable replacement for proof of work. It compromises the security properties of the system, and it introduces a wealth-concentrating mechanism. Stakers are rewarded in proportion to the amount of currency that they have. This literally bakes capitalism into the system. See the next section for more on this.

Perceptions of Bitcoin's current and future energy consumption tend to be overblown. Yes, it uses more electricity than entire (small) countries. However, that currently amounts to under 0.5% of global energy consumption, and it peaked at under 1% in 2022 (see here and here).

Environmentally-focused skeptics tend to assume that Bitcoin's energy consumption will continue to increase without limit. This is dependent on the "deflationary spiral" idea that the price of bitcoin will also continue to increase without limit. Both are incorrect.

Yes, there is a hard cap on the amount of bitcoins that will be produced, which makes it a deflationary currency. Yes, this will result in more saving ("hoarding") and less borrowing when compared with the inflationary currencies that we use now. Yes, that means there will be less investment due to the lack of cheap credit. However the "spiral" part is nonsensical on its face. Bitcoin is not some economic black hole that we'll throw all of our economic resources into until we starve to death. Besides, from an environmental perspective, less investment should be a good thing.

Without the "line goes up forever" aspect of the deflationary spiral, the argument for runaway energy usage falls apart as well. Bitcoin will use an (eventually) stable, likely small percentage of our global electricity output. If we're generating that electricity from sustainable sources, we'll be fine. If we remain stuck on fossil fuels, we'll choke to death on carbon even without Bitcoin in the mix.

There is a silver lining to this aspect of Bitcoin as well. It's to at least some degree incentivizing renewable energy deployments. There are lots of areas that have "stranded" renewable energy, in that they're a good place to harvest electricity, but there's no one nearby to use that electricity, and no power transmission infrastructure to carry it to populated areas. Previously, smelting operations would be set up in these areas to turn bauxite into aluminum. However, Bitcoin mining has significantly lower overhead. You can set up solar/wind/hydro, ship in Bitcoin miners, and make some money off of it without having to run long-distance power lines right away. Once the lines are built, or once some power consumers set up nearby, the mining rigs can be sent off to some other site.

Continued in reply

TL;DR- This turned out way longer than I expected. Skepticism of Bitcoin among solarpunks is understandable, but things aren't as bad as they seem.

I'm neutral on the defederation issue here. I am overall mildly hostile to Monero, and also mildly against defederation without a strong reason (such as being EH, grad, or HB). However, I would like to address the idea that Bitcoin (specifically) and proof-of-work are antithetical to the interests of solarpunks.

To lay all my cards on the table:

• I don't really consider myself a solarpunk, so this is a bit of an outsider perspective. I think solarpunk is kind of cool, but it's also new to me.
• I'm here to lurk (and maybe participate) in the anarchism community. I've been an anarchist for a long time (almost 20 years), mostly centered on mutualism. I've also been interested in alternative currencies (digital and otherwise) since before Bitcoin existed.
• I do have a financial stake in Bitcoin, but not any other cryptocurrencies. I sincerely do not believe my commentary in general has any effect on the price of bitcoin, and especially not when addressing such a small audience. I am not looking to convince anyone here to buy anything.
• I have been heavily interested in Bitcoin almost since it's creation, and as a result have a pretty deep level of knowledge about it. I want people to understand Bitcoin both because I enjoy sharing my obsessive interests with others, and because knowledge is power and power should be widely distributed. The latter part goes double for anarchists, because I want anarchists to be well-informed in order to help the anarchist project succeed.

For the purposes of my argument, everything bad that is said about altcoins (non-Bitcoin cryptocurrencies) is true. Some of them can maybe be generously described as "honest experiments that are likely to fail". The rest are varying degrees of scammy, up to and including "intentionally planned as a scam from the start". Monero is probably one of the lesser offenders in this regard.

Also, I'm presuming that at least some people here see some value in the existence of decentralized digital currency. If you think money is inherently bad and that humanity should abolish it completely, then obviously through that ideological lens Bitcoin is all downside with no benefit. The only thing that I can do to change your mind is to convince you to change your lens, and that's outside of the scope of this discussion.

Continued in reply

699 yen is a fucking steal. "Hello yes I would like a brand new BRAIN COMPUTER for 4.77 USD."

Even if it's in nuyen, that's an extremely good deal.

Subscribed. I've seen an anime or two in my day, so I might be able to help identify.

For when you want to see each individual hair on the kitty cat.

It seems like you think I'm advocating for something that I'm not? "People should be free to choose who they associate with" does not mean "people should not cooperate with each other".

There are plenty of natural incentives to cooperate, and people mostly do so by default. They just shouldn't be forced to stay in organizations that abuse them. Being opposed to abusive relationships doesn't not imply that one is opposed to relationships in general.

Well, I’ve never heard of a well-informed anarchist either, so there you go.

They just don’t understand any of the basics of organisation.

It sounds like you haven't had much interaction with anarchists beyond maybe high-school, and haven't read anything that we've written.

Also, police organizations complain that anarchist activist groups are too hard to infiltrate because there's too much reading to do:

Infiltration is made more difficult by the communal nature of the lifestyle (under constant observation and scrutiny) and the extensive knowledge held by many anarchists, which require a considerable amount of study and time to acquire.

Literally "I can't blend in with these fucking nerds because they read too much".

They just base their whole ideology on the delusion that everybody’s just gonna play nice, nobody will want to do anything for their advantage and, cucially, that crime just doesn’t exist.

Our philosophy is centered around dealing with the organized crime of the state and the exploitation of the capitalists. If you generally can't trust people to play nice, putting a few of them in positions of power tends to make the problem worse, not better.

I wanna see how any anarchist society deals with a murder.

Which aspect of it? Basic security is pretty simple, and there's a number of ways to provision it. Forensics would be handled by contracting professional specialists. Trials would be handled by a polycentric legal system (as opposed to the monocentric one that we currently have. Punishment would generally be in the form of either restitution paid by the perpetrator to the victim (or next of kin), or exile.

But that’s already much too high for anarchists, who barely understand basic human incentives.

C'mon now, this is just confidentlyincorrect material.

Nobody wants to organize horizontally.

Yet you're posting this on a rapidly growing horizontally-organized social media system, running on top of a wildly successful, half-century old, horizontally-organized global computer network governed by "rough consensus and running code". Curious.

~~Obligatory "I am very smart"~~

It doesn't mean that people can't coordinate, just that the coordination needs to be voluntary. Think networks rather than hierarchies.

It's similar to how the fediverse is organized. Any instance can defederate from any other for any reason, but we all try to mostly stick together, because there's benefits to doing so. Those that are dissatisfied with the policies of the instance that they're on can break off and form their own (ideally we'd have account migration too, but that'll take time). No one is forced to connect, but the whole thing works regardless.