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The good old Days
If you are new to crypto you've only heard about these mythical times, times when you could mine BTC using your laptop's CPU, a time when a Raspberry PI setup was pragmatic and fascinating to implement. As a matter of fact, some setups looked like technological art, and I mean that sincerely.
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Today however, even the mightiest of those rigs would not make the smallest of dents. In other words, the speed with which requirements for mining have increased as the difficult for mining has scaled, have far outpaced most conventional setups one can create at home.
Believe it or not, there was a time when an unimpressive CPU mining rig could still mine thousands of Bitcoins per week. An important detail however, BTC was only some cents back in those days, so mining these coins was not making anyone rich, at least not for those who never kept any or HODLed as we call it these days.
GPU mining
When GPU mining entered the scene it revived many enthusiastic spirits. All of the sudden it was possible to mine again, if not BTC directly or efficiently, an option that could be traded for your favorite crypto.
The space of mining has always been evolving and continues to do so today, the creation of mining pools made it possible for small miners to participate, the birth of mining marketplaces, like it's the case with Nicehash revolutionized the way we see hash power, and all of the sudden everyone and their mother found themselves collecting a GPU or two for the idle times.
That being said the GPU mining era has also been expiring you could say, and the reasons are pretty obvious for anyone who has been paying attention to the numbers. The difficulty levels of most crypto projects have skyrocketed while at the same time, the bear market has been testing our levels of commitment as well.
It's easy to see that this is the case today. Taking a peek into ebay, or craigslist will show you hundred of people selling video cards, and sometimes complex mining rigs that they've decided to shutdown. With the exception of the most commited of them all, or the ones who get free electricity (they do exist), most hobby miners have ceased operations.
Let's not Forget ASICS
You may be asking yourself the obvious question. Why has difficulty increased so much? The answer is nuanced, complex, but it can be attributed with a lot of weight to the introduction of ASIC miners into the mix.
Miners are nothing more than specialized computers that can only do one thing. In other words, they can only mine a certain coin, with a certain algorithm, but they do it with extreme efficiency. The problem however is that when a new ASIC miner is launched into the market by Bitmain or one of it's competitors, the effects it has on the network they are designed to mine are always the same, thus predictable.
They will increase the rewards for the early adopters, and as more and more jump in, reduce the rewards by increasing the difficulty on the network, while at the same time leaving all of those who did not jump into the ASIC completely behind. In other words, a race against obsolescence.
The word is not misused her, because literally a miner that went for thousands of dollars a year ago, is nothing more than deadweight today. Imagine buying a computer, a laptop for that matter with a 6,7 month expiration date. Doesn't sound like a good investment to me, but some people love the gamble.
We are transitioning
And in actuality, we have been for a long time. The introduction of other methods to achieve consensus is nothing new, but it seemed like when they were introduced, people saw them as options and today they seem to be the only way forward.
Starting with POS(Proof of Stake) and later DPOS(Delegated Proof of Stake) the answer seems to be staring us right in the face. How long can we keep on making these disposable machines? How long can we keep on running at a loss because we love the ethos, the tech? I submit to you that everyone has a limit, and I think it's reasonable for people to elect to shut their miners down.
A youtuber that I've been following for almost a year now recently made a video that I think illustrates the points I'm making perfectly, and as you might imagine, his perspective made me think about this inevitable change we are experiencing.
It all comes down to scalability
And that has always been the challenge here. How do we go mainstream without requiring quantum computing? It's obvious, by switching lanes, by not playing the 1 BILLION terahash game we seem to be so eager to partake of.
I suspect this challenge will end up killing a lot of unprepared projects, all the ones that don't enjoy of a solid development team or community to take them across the pond of such a massive change. But of course, this is just speculation from my part.
We know Ethereum is already working on this, and their Constantinople fork is in my view a confirmation of precisely what I'm talking about, as much as that might anger a hardcore crypto miner.
All this to say that this is one of the main reasons why I believe that graphene platforms like: STEEM, EOS, Bitshares, and even the new projects popping up like it's the case of Whaleshares, are already ahead of the game by a long shot.
Stop? While home miners will stop, the mining itself will never stop. It only migrates to the uper levels of everything. Mining at home looks to me like ages ago.I've stoped mining back in 2014.
Had the joy of getting new BTC's with plain CPU, then GPU. Then a FPGA. What a thrill waiting for my first gen ASIC's to arrive (AVALON). Then the second gen ASIC's... Then I quit.
The future was clear: wether I replace/upgrade my ASICs every 4-5 month, or I am doomed.
I made a tough cut. Quit.
But the race goes on....
i guess its more the hobby/home miner... mining won't stop all together anytime soon, but just like you, thousands are dropping out of the race.
I am now in different type of race - STAKING.
And also running a bunch of masternodes for various coins. Still having fun. :)
Good one!
However, playing the 29 sextillion hashes per 10 minutes game has some hidden advantages. Bitcoin is creating the most unhackable set of random numbers in the world every ten minutes, and no one seems to be taking advantage of that.
Also, we won't be in a bear market forever. Mining will become quite profitable again, and when it does, it won't be easy to buy the equipment like it is now.
Also, I am one of those people that has 'free' electricity. It comes with the rent, so if I wanted to I could easily leech from my landlord.
Not only that, in the winter time the power consumption is trivial because most the energy lost dissipates as heat. I'm surprised this hasn't become more of a thing: hooking up a mining rig to central heating. This is especially relevant in extremely cold climates.
We are also seeing plays to use renewable energy for the mining rigs. This allows people to farm energy anywhere in the world without having to worry about making that energy profitable by transporting it elsewhere and selling it.
One of my Insta Oldies but a Goodie. Satisfied Seal Crypto Miner.
True story, I got a couple of ASICS, currently unprofitable until the SiaCoin fork and pretty much SOL on the other unless I replace the chips. Anyways, they help keep my turtle bros warm (Got an aquarium in the garage.) when it's cold so guess it could be worse.
perfect meme! hahahah a
this is not a bad idea, central heating mining rig :D mining only in winter time :)
we were joking with a friend years ago, that half of his heating is from a monitor :D he had a small room with a 21 inch huge CRT monitor
That exact same thing happened to me in the last place I lived in. My room was so small that the heat it trapped from my computer was insane.
I think the solar options sound interesting, dunno how feasible they will become or if they will ever reach a point of balance... but definitely something to explore.
When you consider that Big Oil rules the world by force and that they put a lot of effort into stopping renewable energy you really have to wonder if we've already invented Cold Fusion or other similar technologies like sustainable hydrogen power from water.
It's the same reason why many conspiracy theorists think there is already a cure for cancer: infinite energy and happy/healthy people aren't profitable.
When you hear the numbers of the sheer scale of energy being consumed for these mining operations, it seems pretty obvious that it's a non-sustainable path forward:
https://www.cbc.ca/news/business/bitcoin-electricity-1.4668768
I think it's only a matter of time until PoS & DPoS turn into the main consensus algorithm -- but given how much emphasis is placed on Bitcoin, I would imagine a certain level of adoption rests on the Bitcoin project itself making some kind of switch, and I don't necessarily think that will happen any time soon (not that I know anything).
With the sidechain implementations, we could see a big decrease in the mining difficulty and hopefully somewhat curve this... but, maybe eventually it will become POS too, of that I'm not certain, but it does seem a big crazy to see those numbers.
I don't know enough about the side-chains to comment on any of that. All I know is that it will be interesting to continue watching how everything evolves... Every day I learn a little bit more, only to realize that there's more and more than I don't know, and things are evolving and growing faster than I can keep up.
Of course the mainstream likes to shat on Bitcoin... Here is a video with some good food for thought. Not saying that Bitcoins energy consumption is a good thing, but it may not be as bad as some people might want you to think...
In a nutshell, Mining bitcoins is not 'location dependant' like you don't have to be in a specific geographic area to mine Bitcoins, you can do it anywhere there is power and internet. And the large mining operations will of course go to where the cheapest electricity is available. And usually, that is because there is a surplus of electricity. I visited a hyrdroelectric dam last year where, even though it was built in the 1920's ... it was only utilizing like 4% of it's capacity...
Also its funny, you'll never hear about CBC mentioning about the banks, their huge office buildings, often with lights on 24/7, their massive server farms, nobody bats an eye at their energy consumption, which is also really up there.
Now having said all that, Yay DPOS!!! 🙌
CBC does a pretty good job of ripping on banks for a lot of their shady and predatory practices, but I would think that their energy consumption is a much less significant issue -- likely several orders of magnitude lower than bitcoin mining (given corporate energy consumption is -- I would imagine -- lumped in with national energy consumption; if bitcoin mining is found to be using more energy than small~medium scale nations, then office buildings using lights is probably insignificant in comparison).
I agree with you though that not enough context is given for how much energy is consumed by large tech companies, their huge campuses and server farms.
That being said -- I've written all the above without checking out the video, which I'm checking out right meow.
EDIT: Just watched the video. Anton makes a lot of good points -- and I think his case of understanding the "hidden costs" is super important. A lot of this also applies to stuff like Hydroelectric dams. While better than coal-fired plants, or other dirty power generation methods -- they still, typically, require flooding huge areas of land that were previously animal habitat or fertile farm land (Site C dam in BC suffers from these issues as well). Rivers get choked off, or materials are consumed to produce PV panel arrays.
I guess at the end of the day -- yes, the energy consumption claims of bitcoin are probably overblown and taken out of context to other products or industries. But it still stands that the world is suffering from energy shortages in certain places, as well as the effects from intense resource consumption. It certainly seems like PoW consensus is more of an energy hog than some alternatives -- so it would make sense to be striving to attain that level of efficiency where possible, practical, and secure.
EDIT 2: Thanks for the chat!
Hey, yes it's not a clearly drawn black/white issue, I do agree that the massive energy consumption isn't a GOOD thing, especially considering that those machines are running 24/7 and using energy even when not finding blocks... It must indeed be staggering, but I just wanted to bring a little bit of balance/perspective as Andreas has pointed out. I mean, there's always two sides to every story, and somewhere in the middle is the truth. Indeed though, wasting energy isn't a great thing, and I wonder because I hear a lot of China is coal-fired electricity, and lots of mining happens there(in fact, I hear the government is even giving free power to mining operations, whether or not that's true, would have to be looked in to)
One last thing, 10 minutes(if not hours) for a Bitcoin transaction? Come on... Move over BTC, come on Graphene! 😁 Definitely happy for the chat as well. I enjoy the random talks here on Steemit. 🙂
Bitcoin will never transition. Bitcoin is already a dinosaur; an anchor that the rest of the space can trust to always stay the same. The entire community profits from Bitcoin's consistency. There is no need to change it. It simply will stop being the #1 coin, but it will still have great value.
If you had a ship, the anchor is very important, but it is certainly not the most valuable piece of equipment you have. Bitcoin is the anchor of crypto. We need it to feel safe and grounded. We need it to get the rest of the world to board the ship. Once we have mainstream adoption, the security and brand-trust that Bitcoin provides will no longer be the #1 priority of the space.
Also, when you think about it, the Sun provides infinite energy. It doesn't matter how much energy Bitcoin consumes if that energy is renewable. This is a problem that's going to solve itself.
@edicted @mstafford this is a little bit in the realm of Conspiracy, but have you two ever heard of Wardenclyffe, Nikola Teslas Tower? Rumour has it that this was supposed to be a wireless ENERGY transmission system, but when JP Morgan who was a financier of the system found out it was a 'free' energy system that could not be metered, he branded the thing as a death ray and had the whole project scrapped. Basically the idea was that this system was generating electricity from water running underground in aquifers, harnessing the electrostatic energy that this (constantly running) water generate and was able to transmit this WIRELESSLY, hence not being able to meter it.
Like I said, that's all fully in the realm of conspiracy, but since we're already on that route, I'll take it a step further and mention that I watched a video with seemingly strong compelling evidence that the ancient Egyptians knew as well how to harness this, the pyramids not really being tombstones but rather.... power plants! The evidence being things such as a graphite tunnel(graphite being an amazing electrical conductor) running very deep underground... As well purportedly the hieroglyphs inside the pyramids, the walls are all clean and if they were using burning torches to illuminate what they were doing in there, there would be soot everywhere on the walls/ceilings which there is not I guess. Also there was I guess a giant gold capstone at the top of the pyramid, which has since been missing... I mean... who wouldn't want a giant gold pyramid capstone?? ;) The idea being that ancient civilizations were more primitive than we are and we are like the 'pinnacle' of technological advancement may not be as accurate as our modern day narratives say... BUT HEY... THAT'S ALL JUST A CONSPIRACY... But it makes you wonder when this is on the money:
I think some of that is fact.
At 3:40 of this Drunk History clip:
Obviously, Drunk History is the foremost authority of truth :D
The dinosaur / anchor analogies are good -- and I think you're on the money with that.
However, your point of the Sun providing infinite energy (while true) is drastically far away from being taken advantage of. I would suggest that it's not a problem that is going to solve itself (especially when considering some of the recent reports stating the required timelines to radically reduce emissions). It would be ideal if bitcoin mining operations were all fusion and solar powered -- but it's a bit unrealistic to expect that any time soon.
It's been shown that printing money and even just minting pennies takes more energy and resources than Bitcoin.
The value, trust, and portability that Bitcoin provides is worth more than ten times as much energy as we are currently putting into it.
The whole energy consumption argument in opposition to Bitcoin is totally fabricated fake news. It's the same as when economist Dr. Doom tries to tell us that it would cost $60 to buy a cup of coffee with Bitcoin. These people are overreaching as hard as they can to stop crypto from going mainstream because they know it will cripple the establishment.
The fiat currencies in Venezuela, Iran, and other middle eastern counties is already doomed. Central banks no longer have the means to hit the nuclear winter option to stop the bleeding. Fiat will continue to bleed into crypto until it finally bleeds out, starting with the weakest economies first.
You really have to wonder if these weak economies are going to come out on top because they were FORCED to transition to this superior system sooner.
I haven't seen anything backing this -- but I wouldn't be surprised if it were accurate. I think people often forget that the metal coins and paper notes they use have to literally be mined/refined/cast/processed/counted/distributed to be used -- and a similar, though different, process for paper/trees (or plastics for todays polymer based notes).
I agree with you that probably, the problem is severely overstated -- and likely for selfish reasons on the part of traditionalists / banksters. That doesn't change the fact though, that there appears to be a more sustainable solution (and like all things, probably even better solutions to come in the future).
Good chat!
Haha! Good chat indeed! Sometimes I forget I'm not even that bullish on Bitcoin. I'm holding zero Bitcoin right now and half my stake is in Steem. We are so undervalued it's not even funny.
I'll admit to being pretty ignorant about the rest of the "crypto-space"...
Throughout my life I find myself getting swept up in trends / fads / other stuff that eventually becomes popular (at least where I live). I think the fact that I'm on here, interacting with people via blog posts, polls, card games, videos, streamcasts, photos, and other stuff (as well as developing my own project) is evidence to the utility (or at least functionality) that Steem has.
It certainly seems like it's the most accessible coin/token/project out there. It might be a bit confusing, but I think that's par for the course for the entire 'crypto-space' (of which, again, I know very little about).
ProgPOW provides a way to make mining permanently ASIC proof. Ethereum is considering it and some coins are already using it. GPUs may have another life. I hope so because only GPUs can provide true decentralization. DPOS is good for something like Steem but not for a pure currency as it is far less secure.
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Programmatic POW sounds interesting... I mean, if we kill ASIC, we should "eliminate" the issue... then again, its gonna be a level playing field for longer for sure.
Prog POW is being led by OhGodAGirl (discord) a fellow Aussie who is a brilliant hardware geek.
Sounds interesting. I thank you for pointing to this.
I remember mining bitxoins with CPU at some cents and then when bitcoin surpased the dollar .. and then GPU mining and then I thought... Bah I'm stopping ... this is not sustainable. It will always require more power and I wont be able to mine. What a big mistake I did... But at least I was right in the end haha.
so interesting. i'm not up to speed on this side of it At All, but it's very interesting to me to see how the space is developing. glad our platform is ahead of the game!!
I cant remember the Source but someone told he calculated everything and said, that at about 3.500$ mining bitcoin will not generate profit anymore. Not sure why you think its already mining at a loss, but im not so much into crypto to know. This is why i ask. ;)
probably a really stupid question, and the answer is probably no, is not there a way to use ASIC miners for something else? i have no idea how they work.
not a stupid question Bil, not at all... and sadly the answer is no. They are meant to run one algo for 1 currency and that's it... so once they've outlived their usefulness they are literally dead weight.
i was going in the direction that they are fast and would be great to make them render or something like that (when the price drops after that 6-7 months)
that would be awesome, but you gotta be a hacker and a half to pull such mod off..
Wow amigo, cuanto hemos avanzado y parece que fuera en mucho tiempo, pero no.
La tecnología nos arropa y tenemos que ir a la par del compromiso que se presenta.
Gracias por traernos siempre buena información y crypto-reflexiones.
Estaré pendiente para este viernes a las 4 para escucharte...
I'm glad I did my research a year ago and charted out projected earnings of graphic cards against the cost of electricity and payoff of equipment cost, since not long after the market took a dump and aside from all my holdings becoming mostly worthless, it would have stung more to have been holding onto worthless mining equipment =p
All I had to do was go through the post and the comments. Lots of knowledge here!
i love it when that happens, when the comments are the real gold!
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