This article was written 3 hours ago and now BTC is $16,859 so another 5.6% jump. That's about as much volatility in 3 hours as the USD has in 3 years. Something else of note is for all of that power consumed BTC only handles about 4 transactions per second on the block and it's only theoretically capable of like 7 transactions per second. Visa and paypal can handle thousands (and hundreds of thousands) of transactions per second meaning BTC could never possibly scale for that use. Right now because the verification time is so long for BTC people use centralized exchanges to act as intermediaries in transactions (they transfer funds immediately and then wait for the verification on their end) which is functionally like using a bank anyway. These exchanges are unregulated and sometimes get hacked (NiceHash) or are suspected in stealing the funds themselves (Mt. Gox). ETH smart contracts and blockchain itself has more merit but BTC as a cryptocurrency in its current form will never scale. ETH is slowly moving off of cryptocurrency more towards proof of state (smart contracts) due in part to the massive power draw used to verify cryptocurrencies. It already has higher theoretical scale than BTC though not by much (only a couple more transactions per second).
George Strnad
I love this site.. I read it often. but.. this article is a bit disingenuous. Please don't mislead the reader when you use the word "transaction". and compare that transaction to the power of Serbia. So.. you mean to say that when I buy or sell a bitcoin, that I could possibly brownout Serbia? Really? that makes sense to you? Or did you possibly mean to say that mining is getting harder and harder, and there is an increase in computation power or some time, that may seem to be high.. Also, you didn't mention how much Serbia consumes per hour, or minute, or were you referring to seconds? You are a scientific site, please get your facts straight.
Brian M
Daishi's comment nicely sums up the stupidity of this type of currency. Some of them can be solved by using cryptocurrency as a standard, and have 'working' currencies based on them - similar to the gold standards. However its still early day for cryptocurrencies and we still can't be sure how unbreakable block chain is - The answer to that based on previous history of cryptography is everything is eventually breakable or hackable. So on top of the environmental issues - its just basically a bad system and its advantages of non-traceability/accountability etc., is likely to be legislated away. Its a good investment while there are still idiots piling in - but long term don't bet your pension on it.
Bitcoin-is the most sophisticad Ponzi Scheme fraud ever invented, probably people standing first in chain, artificialy stimulate this rising trend sucrficing partly some of their capital and foolling the others in creating this psycho-fiber of gigantic missed opportunity for those who didn't step in. I will never invest a single dime in it, basically due to murky passt inlcuding using bitcoin as child pornography payment. Now this enviromental impact only adds to this sick madness...it is already showing that without regulation things are spinning out of control..sad but true
Rusty Harris
Surprised the "environmental" bunch isn't all up in a wad over the power required. Individuals really can't "mine" these anymore. I've seen photos of some of the server farms. Unbelievable!
El Bonko
I figure the Bitcoin bubble is nearing the end of the mania phase about now. It may already have had its bull trap, I haven't been keeping up lately. In any case, if you own any, now is the time to cash out. Tomorrow it may be too late.
It's an "horrific 240 kilowatt-hours of electricity per transaction"? In the U.S., the cost of electricity averages a tad over 10ยข per kwh, so someone is paying about $24 for a "transaction". What's a transaction? Last week, I transferred a single bitcoin from another wallet into the Coinbase exchange; their "transaction fee" was about $10. I do not believe Coinbase is subsidizing transfers, so the referenced "transaction" must be something else. Before the recent surge, the total cost of "mining" a bitcoin was roughly equal to the price of bitcoin on the exchanges. This was NOT a coincidence -- miners will ramp up operations if there is profit and will just quit if they're losing money. So, as of a month ago, the cost of mining one coin was about $6000. That is 250 times the referenced "transaction" cost. The math doesn't work, but whatever the cost, it is being paid for by the participants. Absent subsidies, there is no reason for skeptics to be concerned about all the energy being "wasted".
Douglas Bennett Rogers
One property of money that bitcoin does have is significant energy consumption. This is true of all money: gold, silver, copper. Paper and electronic money do not have this property and do not serve well as money. Laws are passed to counter this but they are human, not natural laws. Bitcoin is not useful or recognizable like metals. Bitcoin is durable and portable to the extent that the required technology is present.
Still pretty hard to compare, however does anyone concerned about the environmental impact that Wall Street has? We will one day come up with solutions that will clean the environment (I hope sooner than later), but our way of life and us are the problem. As the world population keep growing there's no way to revert it, even if we just eat veggies and bugs... But yeah, bitcoins are still in their infancy... from now on, due going to mainstream, it will literally skyrocket.
Tony Morris
There is no way a crypto-currency could ever be viable if a $5 transaction costs $20 in electricity - let alone the other costs of providing the computation. Go check your numbers (and sources) again Loz.