64 votes

‘We’re living in a nightmare:’ Inside the health crisis of a Texas bitcoin town

47 comments

  1. [17]
    turmacar
    Link
    It's terrible hearing what's happening to that town, but it's absolutely maddening to hear their doublethink on "someone should do something" and "we don't like regulation".

    It's terrible hearing what's happening to that town, but it's absolutely maddening to hear their doublethink on "someone should do something" and "we don't like regulation".

    51 votes
    1. [16]
      Oslypsis
      Link Parent
      This is why I fully believe a balance between red and blue is necessary. To quote the article, "they took our core values and used them against us." They wouldn't have been able to do that if...

      This is why I fully believe a balance between red and blue is necessary. To quote the article, "they took our core values and used them against us." They wouldn't have been able to do that if there was a little bit more blue to help with reasonable regulation.

      I feel like I want to see someone launch a rocket launcher into that facility, honestly. My anger at everyday stories like these is getting out of hand, and I find myself increasingly wishing to see the population violently stand up against corporations that do these things. I'm just going to take another nap and try to chill. Maybe play Slime Rancher. I know I won't and can't do anything to help, but my frustration just... builds... and builds.

      22 votes
      1. teaearlgraycold
        Link Parent
        I agree at some level. If the political parties were truly in their abstract ideals. If the American right simply stood for less regulation, less taxes, sticking with the old ways by default, it...

        This is why I fully believe a balance between red and blue is necessary.

        I agree at some level. If the political parties were truly in their abstract ideals.

        If the American right simply stood for less regulation, less taxes, sticking with the old ways by default, it would be a good counter-balance to progression, more services paid by taxes, and more regulation. It really doesn’t feel like we’re anywhere close to that dynamic.

        46 votes
      2. [3]
        DarthYoshiBoy
        Link Parent
        I call this the Kite Theory of politics. We (any democracy really) are a kite. To keep aloft we need a string holding us down. Cut the string or use a string that isn't strong enough (as...

        This is why I fully believe a balance between red and blue is necessary.

        I call this the Kite Theory of politics.

        We (any democracy really) are a kite. To keep aloft we need a string holding us down. Cut the string or use a string that isn't strong enough (as Republicans are wont to do) and the kite crashes to the ground eventually. Add too many or too heavy strings (as the right claims Democrats are wont to do, though I suspect our string is maybe not quite strong enough and may snap soon so I think Democrats are more right than wrong at the moment) and the kite is pulled down by the onerous weight of the strings.

        The real discussion in politics should be around "What is the appropriate amount and strength of string to keep us flying" (maybe occasionally discussing whether a kite from 1788 with some small modifications still has a place in the modern world, but I digress) however, the discussion as of late seems to be that Republicans are insisting (absent all scientific support) that we're a jet plane and we'll be okay without any strings, while the Democrats aren't willing to point out how absurd this notion of kite flight without an engine or strings is.

        23 votes
        1. [2]
          sparksbet
          Link Parent
          Well, that but also they arbitrarily think we need MORE strings in certain places. Republicans are extremely eager to regulate what I can do with my body on numerous counts, which wouldn't be the...

          the discussion as of late seems to be that Republicans are insisting (absent all scientific support) that we're a jet plane and we'll be okay without any strings

          Well, that but also they arbitrarily think we need MORE strings in certain places. Republicans are extremely eager to regulate what I can do with my body on numerous counts, which wouldn't be the case if they were consistently opposed to government overreach on principle. It's a very "rules for thee and not for me" attitude.

          17 votes
          1. ebonGavia
            Link Parent
            And it's a very "we need to be hurting the right people (wink, wink)" attitude.

            And it's a very "we need to be hurting the right people (wink, wink)" attitude.

            8 votes
      3. first-must-burn
        Link Parent
        I feel this way so often, but the imbalance of power is so great that even violence seems like an unworkable solution. Setting aside for a moment the question of whether it would be worth it to...

        I feel like I want to see someone launch a rocket launcher into that facility, honestly. My anger at everyday stories like these is getting out of hand, and I find myself increasingly wishing to see the population violently stand up against corporations that do these things.

        I feel this way so often, but the imbalance of power is so great that even violence seems like an unworkable solution. Setting aside for a moment the question of whether it would be worth it to risk innocent lives to take down corporate greed, the disparity between the "justice" meted out for corporate wrongdoing and what I would see if I were to firebomb this place (even if no one was injured) is night and day. There are days when I think I might be willing to martyr myself for my ideals, but only if I thought it would make a difference. As locked down as the media is (even social media to a large degree), I think that sacrifice would likely go unnoticed, or dismissed as crazy.

        The origin of my username is:

        In order to rise
        From its own ashes
        A phoenix

        First
        Must
        Burn.

        ~ Octavia E. Butler, Parable of the Talents

        15 votes
      4. [8]
        arqalite
        Link Parent
        The rocket launcher thing was my reaction as well. Once I read the things that happened to these people I just wanted to burn the mine down. They are this close to literally killing people for...

        The rocket launcher thing was my reaction as well. Once I read the things that happened to these people I just wanted to burn the mine down. They are this close to literally killing people for profit.

        But I'm on the opposite side of the world from Texas, so the most I could do was spread the article around.

        10 votes
        1. [7]
          Oslypsis
          Link Parent
          Someone will die from this before it's over. I mean, a little girl has already had a seizure from it if I remember what the article said correctly. I can't even confidently say that'll do anything...

          Someone will die from this before it's over. I mean, a little girl has already had a seizure from it if I remember what the article said correctly. I can't even confidently say that'll do anything to the company, either. I truly don't know what to do. What team of lawyers or human rights activists can we tell?

          Why does bitcoin even have value?

          8 votes
          1. [6]
            teaearlgraycold
            Link Parent
            At this point, it’s gambling addicts and idiots. Back in the day it seemed like it could be pretty useful. But it’s been under control of the ultra wealthy for a long time.

            Why does bitcoin even have value

            At this point, it’s gambling addicts and idiots. Back in the day it seemed like it could be pretty useful. But it’s been under control of the ultra wealthy for a long time.

            16 votes
            1. [5]
              zenen
              Link Parent
              Disagree. Bitcoin has value because people are willing to devote resources to mining it. See my post below. I'd also ask for a citation on why you believe that it's under the control of any group...

              Disagree. Bitcoin has value because people are willing to devote resources to mining it. See my post below. I'd also ask for a citation on why you believe that it's under the control of any group or individual?

              4 votes
              1. [4]
                teaearlgraycold
                Link Parent
                To be clear I believe it’s under the control of miners and their investors.

                To be clear I believe it’s under the control of miners and their investors.

                8 votes
                1. [3]
                  zenen
                  Link Parent
                  Sure, the mining operations are absolutely controlled by the wealthy. The network itself is secured democratically by people like myself who are running regular (non-mining) nodes. For as long as...

                  Sure, the mining operations are absolutely controlled by the wealthy. The network itself is secured democratically by people like myself who are running regular (non-mining) nodes. For as long as the network is held by the public, the basic rules that make it a valuable resource are still in play.

                  1. [2]
                    teaearlgraycold
                    Link Parent
                    My understanding is the miners get to decide the protocol changes. Random verification nodes can’t expand the block size for example.

                    My understanding is the miners get to decide the protocol changes. Random verification nodes can’t expand the block size for example.

                    7 votes
                    1. zenen
                      Link Parent
                      Partially true. The improvement process is detailed in part 6 here: https://cointelegraph.com/explained/what-are-bitcoin-improvement-proposals-bips-and-how-do-they-work BIPs require 95% approval...

                      Partially true. The improvement process is detailed in part 6 here: https://cointelegraph.com/explained/what-are-bitcoin-improvement-proposals-bips-and-how-do-they-work

                      BIPs require 95% approval from miners, and the final say is held by the people who choose which version of the protocol they want to run.

      5. [2]
        Melvincible
        Link Parent
        You took the thoughts right out of my brain. Also been playing Slime Rancher (2) to relax, it really has a calming effect...

        You took the thoughts right out of my brain. Also been playing Slime Rancher (2) to relax, it really has a calming effect...

        4 votes
        1. chocobean
          Link Parent
          "Their coral hue is scientifically proven to be the color of cheer. " I think about that a lot, especially because my name has some origins associated with "coral". There are a lot of terrible...

          "Their coral hue is scientifically proven to be the color of cheer. " I think about that a lot, especially because my name has some origins associated with "coral".

          There are a lot of terrible things in the world, far away and as well as close by. On a day to day, the best we can do it play a bit of slime rancher, hug our loved ones, try to be kind and help someone, and go get some sleep.

          2 votes
  2. arqalite
    Link
    TL;DR: Granbury, TX residents are reporting severe health issues, and the cause is believed to be the nearby Bitcoin mine that constantly exceeds the local noise limits. It's almost impossible to...

    TL;DR: Granbury, TX residents are reporting severe health issues, and the cause is believed to be the nearby Bitcoin mine that constantly exceeds the local noise limits. It's almost impossible to prove that the Bitcoin mine is causing these illnesses though, and the owner of the mine is armed with lawyers in an attempt to shut down any lawsuit.

    This is a terrifying story, I can't imagine the torture these people are enduring. As someone who can't stand loud noises and wears ear protection at festivals no matter what, I would probably go insane in a matter of days.

    41 votes
  3. [3]
    OBLIVIATER
    Link
    I never would have imagined a Bitcoin mine of all things would have some of the same environmental concerns as an actual industrial facility. There's something deeply ironic about that... I would...

    I never would have imagined a Bitcoin mine of all things would have some of the same environmental concerns as an actual industrial facility. There's something deeply ironic about that... I would have thought there would be a more efficient way to cool huge data centers like that other than just thousands of computer fans. It's wild that it's loud enough to cause a whole community stress.

    20 votes
    1. [2]
      teaearlgraycold
      Link Parent
      Real data centers have better sound isolation and cooling systems. Presumably Bitcoin farms are like this because they’re operating on thinner margins. If you’re hosting web servers you can...

      Real data centers have better sound isolation and cooling systems. Presumably Bitcoin farms are like this because they’re operating on thinner margins. If you’re hosting web servers you can upcharge customers on support packages, guaranteed uptime, etc. If a Bitcoin miner goes offline there’s no customer relationship ruined. So everything’s done just good enough.

      27 votes
      1. Omnicrola
        Link Parent
        Your assumption appears to be correct. FTA (it's long!):

        Presumably Bitcoin farms are like this because they’re operating on thinner margins.

        Your assumption appears to be correct. FTA (it's long!):

        “Historically, Bitcoin miners go to the cheapest source of electricity with the least amount of regulation, and they do the cheapest thing possible,” DeRoche says. “It's one of the reasons why noise pollution from crypto mining tends to be so much worse than traditionally-operated data center operators.”

        As Bitcoin continues to gain value, miners are building progressively bigger operations, causing gas plants and other fossil fuel emitters to spring back into action.

        27 votes
  4. [23]
    zenen
    (edited )
    Link
    As one of Tildes' resident pro-Bitcoin people, I have been long frustrated by the obnoxious nature of the crypto community in many respects. I see it as a neutral tool that can be swung in any...

    As one of Tildes' resident pro-Bitcoin people, I have been long frustrated by the obnoxious nature of the crypto community in many respects. I see it as a neutral tool that can be swung in any direction by the people who make use of it.

    This is an extractive resource management. Proof-of-work is necessary for the currency to have any "real" basis for value outside of speculation, but like the article says: it doesn't need to cause harm to the surrounding environment. The fact that this operation is running on the thinnest possible margins without investing back into the community where it exists is short-sighted and greedy.

    People are only going to adopt Bitcoin as a store of value when its presence is a net positive on the community. Mining with non-renewables, obnoxious operations, obnoxious people, scams, robberies, recreating fractional reserve banking (see: FTX), this stupid libertarian mentality of ignoring one's privilege to have been able to invest early... these are all things that prevent this tool from actually solving any of the problems it is built to solve.

    I don't blame anyone for being on the other side of the fence. The fate of any currency lies largely in the hands of whoever holds it, and I'm still betting on the silent majority to be at the very least less bad than the people who control most of today's global wealth. At least there's a decent chance that Bitcoin whales have known what it's like to be the underdog for part of their life.

    20 votes
    1. [2]
      Pistos
      (edited )
      Link Parent
      Update: zenen edited to clarify:

      As one of Tildes' resident pro-Bitcoin people, I have been long frustrated by the obnoxious nature of the community in many respects.

      You should perhaps clarify which community you mean here.

      Update: zenen edited to clarify:

      frustrated by the obnoxious nature of the crypto community

      8 votes
      1. zenen
        Link Parent
        Sure, done. I don't think I would ever venture to call this community obnoxious. Opinionated perhaps, as I've noticed that there aren't too many even-footed discussions around certain polarizing...

        Sure, done. I don't think I would ever venture to call this community obnoxious. Opinionated perhaps, as I've noticed that there aren't too many even-footed discussions around certain polarizing topics (cryptocurrency being one of them). Nothing ever gets overly aggressive or disrespectful around here though.

        While on the subject, though, I've actually started to notice a sort of religious fervor which grabs people when discussions turn to Bitcoin. I think that there's a huge gulf between people who invested at a fortunate time and others who have been burned. The latter group might also include people who don't really want to invest based on the industry, people who believe that cryptocurrency is unsound as a store of value, and people who have taken a 'sour grapes' attitude about the entire field.

        I think that there's a lot of people in the middle of this gulf that just don't know how it all works, and these people are most vulnerable to the shills, scams, and rackets of the field. If they get burned, they're probably going to turn towards the latter camp. Other people end up on the fortunate side and end up in this self-congratulatory Cult of Crypto where they are told that they 100% deserve their good fortune and should act with contempt towards anyone who says otherwise. This dynamic really annoys me, which is part of the reason why I try to be vocal about my stance in this community - it's important to me that I can represent things that are important to me without defending myself or criticizing anyone else for taking issue with some of the very obvious and glaring issues associated with how it shows up today.


        To summarize my views on cryptocurrency: the US Dollar hasn't been pegged to anything material since Nixon killed the gold standard. Since then, the force that has backed the soundness of the US Dollar is violence and military dominance - that's what ultimately decides whether or not someone has the right to print more money.

        I don't like this system, nor do I like the privileges it grants to central banks and similarly powerful corporations. On that basis, having access to a store of value which is backed by something other than violence is comforting to me, because it gives me hope that the military-industrial complex could one day be rendered obsolete.

        Anyone who holds or promotes cryptocurrency as a means of gaining wealth and power within the system we live under (10x your investment easily!! check out my new lambo) can get stuffed. /rant

        10 votes
    2. [20]
      vord
      Link Parent
      While I thought that way back when, I think the only crypto that actually has any claim to real basis for value is something like filecoin where you mine by storing encrypted blobs of data from...

      Proof-of-work is necessary for the currency to have any "real" basis for value

      While I thought that way back when, I think the only crypto that actually has any claim to real basis for value is something like filecoin where you mine by storing encrypted blobs of data from people.

      5 votes
      1. [19]
        zenen
        Link Parent
        So, here I would point to the difference between instrumental and intrinsic value. Filecoin and everything in the Ethereum space has instrumental value - it is valued for the things that you can...

        So, here I would point to the difference between instrumental and intrinsic value. Filecoin and everything in the Ethereum space has instrumental value - it is valued for the things that you can do with it, such as storing files on peoples computers, running distributed computations, offering cellular coverage etc.

        Bitcoin doesn't do any of these things; it is inert. This isn't to say that it can't be leveraged to make a lot of these things happen (there's some really cool stuff happening with the Lightning Network), but it does mean that the value of Bitcoin itself is not predicated on anything than what it is.

        If I come up with a better system for storing encrypted blobs on a distributed system, then the value of something like Filecoin might drop because it is no longer as useful. If people unanimously decide that there is a better way to program smart contracts than Solidity, then Ethereum loses its instrumental value.

        With proof-of-work, the value is intrinsic. A Bitcoin is valuable in-and-of-itself, because someone was willing to devote the effort into mining it. If you spend 10 hours creating a piece of artwork, that artwork will have value to you. It doesn't matter if anyone else acknowledges or quantifies that value, because chances are that if I offer you one hours wages for your artwork then you will say "no, I worked harder than that to make this".

        The value of Bitcoin is rooted in the fact that people are willing to invest energy and resources into acquiring it. That energy can not be repurposed or recuperated; it has been assigned in a one-way operation that secures the value of the blockchain. Ideally this would be clean energy, but greed has proven to be a surprisingly effective motivator.

        3 votes
        1. [18]
          TMarkos
          Link Parent
          It's all a bit circular, in the end. There's very little to justify Bitcoin's price at its current mark, save that people will buy it at that price. It would be a dutch-tulip sort of curiosity...
          • Exemplary

          It's all a bit circular, in the end. There's very little to justify Bitcoin's price at its current mark, save that people will buy it at that price. It would be a dutch-tulip sort of curiosity save for the real-world harms inflicted by crypto miners on all the rest of us. Crypto's use of electricity (0.6-2.3% of US electric use!) alone renders it exhaustively expensive and irresponsible at a moment when the world is confronting accelerating climate change; the fact that it also has harms such as those detailed in the article is just the crappy cherry on top.

          I'm not philosophically opposed to crypto, but as-implemented in the real world it brings almost wholly negative impacts. There is no use case, and certainly none implemented at any real scale, that could possibly justify spending several dozen terawatt-hours worldwide each year. Calling it a neutral tool is fair, and I'm sure you could come up with a variety of really neat individual examples of it being used for good ends. Those remain valid; my response to each is: several dozen terawatt-hours. No matter what you place on the other side of that scale, it does not balance.

          31 votes
          1. [17]
            zenen
            Link Parent
            I think you're missing the point. The thing that justifies Bitcoin's value is the several dozen terawatt-hours that are being devoted to it, not the number of dollars people will pay to get it. If...

            I think you're missing the point. The thing that justifies Bitcoin's value is the several dozen terawatt-hours that are being devoted to it, not the number of dollars people will pay to get it.

            If you think that the amount of resources that humans devote to cryptocurrency is insane, I might point you towards the US Department of Defense reporting the use of 30 terawatts of energy in 2006 - to say nothing about the amount of petroleum being used. I don't have access to any more recent numbers, but I don't really feel optimistic about what they might say.

            So, when you put the world's collective investment into violence on the other side of that scale, I would say that it more than balances. If you want to talk about irresponsible uses of resources in the current age, then let's talk about war.

            Let's talk about the colonial structures and hegemony and the arbitrary border disputes that cost countless lives. Let's talk about people who work on sugar cane and palm oil plantations because their entire means to be self sufficient as a culture has been destroyed by colonizers. Let's talk about the 40 hour work-week, where people are forced to stand around in a retail store or scroll through HackerNews from behind a desk and call it "honest work", only to be too exhausted at the end of the day to do anything other than binge Netflix.

            I could go on for a while, but it's not worth my time - especially on this platform. The votes are in, and I am once again trying to change people's minds when they've already been made up. All I'm saying is that none of that energy is wasted if we can learn how to use this tool properly. Its real-world implementation is up to us, and if we sit idly by and say "well, there's nothing technically wrong with cryptocurrency, but everybody is using it for bad stuff!" then our complacency puts us at fault.

            You've mentioned in a previous post that 'wealth affords comfort'. Have you considered the amount of wealth you have to be able to spend your time playing video games or posting on the internet rather than spending all day working in a rice field? We are immensely privileged people to be able to even afford this sort of discussion. If you see something wrong with cryptocurrency, or energy use, or wealth inequality, then either use your wealth help fix it or admit that you are complicit. Complaining helps nobody.

            1. [12]
              TMarkos
              Link Parent
              Buddy, you just went right to unrelated whataboutism, sunk cost fallacy, "it's not worth my time to discuss further" and rifling through my past posts for ammo - all because I and others in this...

              Buddy, you just went right to unrelated whataboutism, sunk cost fallacy, "it's not worth my time to discuss further" and rifling through my past posts for ammo - all because I and others in this post have the temerity to suggest that it's perhaps it's not a worthy tradeoff to allocate a small country's worth of energy production to something that produces no value and substantial harms? I understand that you're invested in Bitcoin, both emotionally and I presume financially, but this is not the standard of discourse I hang around Tildes for.

              Take a breath and step back, please. It's fine if you like Bitcoin. It's less fine to be this aggressive because others don't. You say that I should do my part to help fix what I see wrong with cryptocurrency; that is precisely what I'm attempting to do by posting a sourced critique of its harms in a discussion about crypto, right here.

              24 votes
              1. [11]
                zenen
                Link Parent
                You have completely ignored my refutation of your 'balancing the scales' thesis. Storing value through cryptography obsoletes the need to defend that value through military might, and the military...

                You have completely ignored my refutation of your 'balancing the scales' thesis. Storing value through cryptography obsoletes the need to defend that value through military might, and the military industrial complex is a far greater evil than Bitcoin mining.

                The aggressive tone of my response came from you doing very little to address the points I was making on intrinsic versus instrumental value, choosing to dismiss it entirely by saying "it's all a bit circular, in the end" and then citing facts and figures that we are both already aware of. The fact that the response was celebrated as 'exemplary' speaks to the inherent biases and to the echoing nature of this community.

                Given the character of this response, I figured that we were beyond the point of anyone changing their mind - which is where "not worth my time to discuss further" came in. It would have been more appropriate to say "not worth anyone's time", because I always try to approach online discourse in the spirit of gaining a more nuanced view and I assume this in everyone.

                All that said, I'll concede that this did get out of hand. It wasn't appropriate to reflect my frustration with the economic system as a whole onto you as an individual, and I apologize for the personal nature of my arguments. If anything, I hope you understand my point about how lucky we are to afford these privileges we have. It was not meant as an attack, but as an acknowledgement that the way we spend our time is important - I want to spend my time productively and I want the same for others. Hopefully the intent wasn't entirely lost in the tone of how it was said.

                2 votes
                1. [10]
                  TMarkos
                  Link Parent
                  Refutation implies a counterpoint. Your arguments in favor of bitcoin's value rely on acceptance of your premise that value is stored in the allocation of a useful resource (in this case,...

                  Refutation implies a counterpoint. Your arguments in favor of bitcoin's value rely on acceptance of your premise that value is stored in the allocation of a useful resource (in this case, electrical power) into the resource of bitcoin, or at least that's my impression of your argument. However, I do not see a convincing argument that the value is stored in this operation. Resources invested do not mean value accrues. Sometimes, as I would argue is the case here, they merely are wasted. Useful energy is transformed to heat and mathematical results, the former of which is a waste product that underpins the article in the OP and the latter of which continues bitcoin's ecosystem - but the value of that end is contingent upon accepting any inherent value in bitcoin, and cannot be used to prove that value without forming a self-justifying loop. Bitcoin cannot have value merely in continuation.

                  The idea that storing value in cryptography obsoletes the need for military might is likewise not a well-founded argument. When China asserts a claim to an atoll that is claimed by the Philippines, as has been in the news lately, I struggle to think of an application of crypto that would serve as a convincing rebuttal to a PLAN destroyer at anchor. Ukraine cannot squirrel away its millions of tons of stolen wheat in the blockchain or the contents of its ransacked museums in NFTs. The application of military power and its relative morality is certainly a worthy topic of discussion, but it is not one that has any particular bearing on cryptocurrency unless one is talking about the literal seizure of currency, or the use of fiat currency as an avenue of making war.

                  I assert that it is circular because your argument is circular; it proceeds from your assertion that bitcoin has any intrinsic value to begin with. It is a very challenging assertion to claim that it does. Currency of any sort has a very clear instrumental value in that it can be exchanged for goods and services. However, I don't believe that I've ever heard anyone assert that currency is an end in itself, save for perhaps a handful of fictional dragons and one miserly anthropomorphic duck.

                  If your end goal is to suggest that bitcoin has some value that justifies the allocation of resources to the task of its upkeep, then your argument cannot be that the need for said upkeep constitutes value. Real estate, at least, teaches us that it is more likely for the opposite to be true. In China, it is common to purchase apartments as an investment. These apartments have value when sold, and can be translated into fiat currency for its instrumental use. In the current state of apartments as a speculative asset, there are buildings and blocks of disused apartments sitting vacant, storing their theoretical value until the day someone purchases them as a home.

                  Yet the value is contingent upon the notion that eventually someone will purchase said asset for its intrinsic value as a home and live there. When the building cannot be maintained, or market conditions make it apparent that the theoretical buyers are unlikely to appear, that value vanishes. The building, abandoned and unneeded, is knocked down; the investments are worthless. It does not matter that there was an asset constructed of valuable resources there, or even that there was real intrinsic value in the result - the asset was not needed, and is therefore not valuable.

                  This is the scenario which seems, to me, to be most applicable to bitcoin. It applies all the more because there is no obvious intrinsic value in a bitcoin; you cannot live in one, as you could with an apartment. You may maintain that the asset has value, and say the effort needed to obtain it justifies that value, but in the end it has exactly the value that someone else is willing to offer for it, and no more. If you would like to claim it has any intrinsic value, you need to point to anything aside from its notional exchange value as a reason why.

                  10 votes
                  1. [9]
                    zenen
                    Link Parent
                    Firstly, I think that we understand the meanings of intrinsic and instrumental value differently. To me, a house has instrumental value which is based on its ability to provide shelter for the...

                    Firstly, I think that we understand the meanings of intrinsic and instrumental value differently. To me, a house has instrumental value which is based on its ability to provide shelter for the occupant. A PLAN destroyer has instrumental value because it allows you to coerce people to do things they don't want to do, like leave their shelters.

                    USD, Bitcoin, shiny rocks, sea shells, cool feathers etc. all have intrinsic value and no instrumental value, which makes them ideal as a medium of exchange. I can't do anything with them that will help me meet my needs outside of trading them, so I will only use them for that purpose.

                    That said, I will agree that my arguments are predicated on Bitcoin having inherent (intrinsic) value.

                    In my lived experience, I have noticed a strong correlation between human attention and perceived value / importance. The more attention something gets, the more highly it is valued. It isn't a quantifiable relation and diving into my mental model of how this works moves the conversation into a more metaphysical one, so I won't try to justify it. Suffice to say, I consider this correlation to be axiomatic.

                    I think that the inherent value of Bitcoin comes from its original intended purpose as an open-source digital currency. I think it's a valuable idea, other people think its a valuable idea. People have been willing to invest their time, effort, and resources into realizing that idea through infrastructure, hardware, etc. and that is what makes it 'real'.

                    The intrinsic value of Bitcoin is represented not by the cash value that someone is willing to offer for it, but by people's willingness to participate. I'm not talking about huge mining operations like the one in the article above, I'm talking about the early years where people could mine from a regular CPU with zero upfront investment. It had no realised value as a means of exchange, but people thought it was a cool idea and decided to run it on their computers anyways.

                    I also think that people have intrinsic value. My value is not predicated on how much someone is willing to pay me for my time, I'm valuable because people appreciate my existence and are willing to give me their time and attention. You are also valuable, and I appreciate you taking the time to offer a detailed response.

                    1 vote
                    1. [6]
                      sparksbet
                      Link Parent
                      I'm not hopping into the actual debate here, but I do think you're using intrinsic and instrumental value in almost the opposite way they're typically used. Things with intrinsic value are...
                      • Exemplary

                      I'm not hopping into the actual debate here, but I do think you're using intrinsic and instrumental value in almost the opposite way they're typically used. Things with intrinsic value are desirable in and of themselves, whereas things with instrumental value are desirable as means to an end. Currency (fiat or not) is basically a textbook example of something with instrumental but not intrinsic value. Housing and food are textbook examples of things with intrinsic value.

                      10 votes
                      1. kovboydan
                        Link Parent
                        Also not jumping into this debate, simply posting an excerpt from wiki (Money) that may be helpful for folks:

                        Also not jumping into this debate, simply posting an excerpt from wiki (Money) that may be helpful for folks:

                        Fiat money or fiat currency [like USD] is money whose value is not derived from any intrinsic value or guarantee that it can be converted into a valuable commodity (such as gold). Instead, it has value only by government order (fiat).

                        5 votes
                      2. [4]
                        zenen
                        Link Parent
                        Interesting, can you reference some of these textbook examples? I'd be interested in knowing where people think something like gold (the shiniest and most special of all the shiny rocks) fits in here

                        Interesting, can you reference some of these textbook examples? I'd be interested in knowing where people think something like gold (the shiniest and most special of all the shiny rocks) fits in here

                        1. [3]
                          sparksbet
                          Link Parent
                          kovboydan's comment in this thread points out the description of fiat currency used on wikipedia being used in this way, if that's helpful as an example. I'm personally more familiar with...

                          kovboydan's comment in this thread points out the description of fiat currency used on wikipedia being used in this way, if that's helpful as an example.

                          I'm personally more familiar with intrinsic and instrumental value as used in philosophy rather than economics (which is what you'll get from the wikipedia article titled Instrumental and intrinsic value), where there's a tendency to get a little too abstract with it at times (for instance, in moral philosophy food is considered instrumentally valuable because it's only used to obtain satiation/happiness, which are the potentially intrinsically valuable things). Obviously in that philosophical sense almost nothing related to economics has intrinsic value.

                          Within economics my understanding is you often want to get more concrete, treating intrinsic value as value the object has absent the market or economic system, with types of extrinsic value being added on it. Gold would actually be a good example to discuss here of something that has both types of value under this definition -- it's a useful material in a number of ways, which is true even if you're the last person on earth and economics ceases to exist. But it also has value as a commodity due to its rarity/difficulty to acquire, which would be extrinsic/instrumental value that only really exists because of the market.

                          5 votes
                          1. [2]
                            zenen
                            Link Parent
                            Cool, this is useful. I suppose I started using these terms without considering the scope that they were being applied to. My first thought here is on the value of wealth itself. Human beings like...

                            Cool, this is useful. I suppose I started using these terms without considering the scope that they were being applied to.

                            My first thought here is on the value of wealth itself. Human beings like to feel secure, and having something like a stockpile of food helps to abate fears and worries of scarcity. I might posit that there is intrinsic value (in a moral philosophical sense) to having wealth, but I'm not keen to jump into another debate.

                            I think that Bitcoin was designed to be a sort of "digital gold". It also has inherent utility as a distributed ledger or a directory of public keys, but nobody talks about this sort of thing during a gold rush.

                            1. sparksbet
                              Link Parent
                              In a moral philosophical sense I think the things with intrinsic value would be the feelings of security and happiness and such that you get from wealth, while wealth itself would have...

                              In a moral philosophical sense I think the things with intrinsic value would be the feelings of security and happiness and such that you get from wealth, while wealth itself would have instrumental value since it would be for achieving those ends. But I think moral philosophy also argues about whether intrinsic value exists, so it's all a bit abstract at times.

                              I can definitely see Bitcoin as attempting to serve as a sort of digital gold. Certainly the metaphors are already there. But I think the difference in opinion there would lie in assessing how valuable its functions as a ledger are in comparison to its cost to mine. But that's a deeper discussion than I want to have, so I'll leave it there.

                              1 vote
                    2. [2]
                      Lexinonymous
                      Link Parent
                      If that's the case, do you think a Bitcoin-based alt-coin or chain fork also contains that same value? After all, if it's fundamentally the same code at work, why would one chain or project be...

                      I think that the inherent value of Bitcoin comes from its original intended purpose as an open-source digital currency.

                      If that's the case, do you think a Bitcoin-based alt-coin or chain fork also contains that same value?

                      After all, if it's fundamentally the same code at work, why would one chain or project be more or less popular than another, from an idealistic perspective?

                      1 vote
                      1. zenen
                        Link Parent
                        Finally, someone who speaks my language! (kidding, sort of) I think that there is a significant difference between "creating a cryptocurrency" and "creating another cryptocurrency". Bitcoin was...

                        "from an idealistic perspective"

                        Finally, someone who speaks my language! (kidding, sort of)

                        I think that there is a significant difference between "creating a cryptocurrency" and "creating another cryptocurrency". Bitcoin was not the first open-source digital currency, but it was the first to take off in a meaningful way.

                        In my view, the most ideal scenario is for a single cryptocurrency to be recognized worldwide as the most effective store of value available to humanity today. Achieving this, in my understanding, would allow for (and encourage) the development of a non-colonial global economy.

                        Bitcoin is more well-positioned than any other digital asset to become that currency. Every time someone decides to fork the code or build a new currency, it divides this potential global economy and weakens its capacity to overcome the status quo.

                        I'm just going to speak on Ethereum, because I think it does a good job of representing alt-coins as a whole. Ethereum was inspired by Bitcoin and officially released in the wake of Bitcoin's first bubble (2014). In my view, this was a move motivated (at least subconsciously) by greed. Over 50% of the Bitcoins in circulation were already mined by that point, and earning a substantial number of them would have already been more difficult than creating a new cryptocurrency and holding an ICO to control its initial distribution - precisely what Buterin (and countless others) did.

                        Now, instead of there being one main cryptocurrency, there were two. This created in-fighting in the larger community and shifted the dialogue from "why is cryptocurrency a good idea" to "which cryptocurrency is a good idea". Bitcoin can be made to do everything Ethereum can do, and it can be extended to implement the functionality of any other cryptocurrency that's out there today.

                        I stand behind Bitcoin because cryptocurrency is an abstract concept and Bitcoin is widely seen as "the big one". We only need one; having plural cryptocurrencies does nothing to supercede the current economy and only reinforces existing patterns. If there was only one cryptocurrency, FTX and other trading platforms would never exist.

                        To answer your question more directly, "cryptocurrency" as an idea is what holds the intrinsic value. We need an interface like Bitcoin to interact with an abstract idea, but nothing is added to the idea by having more than one of them.

            2. [2]
              teaearlgraycold
              (edited )
              Link Parent
              If Bitcoin is just an under utilized tool, then why defend it so vehemently? You act like you’re financially deep in the system and not so much like you’re interested in the technology. I think...

              If Bitcoin is just an under utilized tool, then why defend it so vehemently? You act like you’re financially deep in the system and not so much like you’re interested in the technology.

              I think the tech is really interesting. I mined Bitcoin back in 2011. It seemed like a radical idea. If it had pivoted to something like USDT/USDC and had no explosive change in value I would have maintained my interest over the years. However 99% of the reason Bitcoin is relevant today is that people think it’s a get rich quick scheme.

              I do know one person who made around a half million dollars off of Bitcoin. Some people definitely got lucky. But even that guy doesn’t really defend it.

              8 votes
              1. zenen
                Link Parent
                For transparency about my financial depth, I hold about 0.5BTC and $100 CAD in savings. I also have a degree in CS and about a decade of experience in tech, so if I chose to be compliant with the...

                For transparency about my financial depth, I hold about 0.5BTC and $100 CAD in savings. I also have a degree in CS and about a decade of experience in tech, so if I chose to be compliant with the system as it exists today I could theoretically liquidate my assets and build a 'comfortable' life for myself. I am vehemently opposed to this path because I would then have to either swallow all of my anger about the world we live in, or become a hypocrite.

                I think that you choosing to mention 'stablecoins' is interesting; I strongly dislike them. Their 'stability' is predicated on the same central banks that Bitcoin is built to render obsolete. Fractional-reserve banking is not a stable system, it would collapse if everybody withdrew their money at the same time. It only has the illusion of stability because it is controlled authoritatively.

                “It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.”
                ― Henry Ford

                The "explosive change in value" you're referencing happened in relation to fiat currency. There was no change to the intrinsic value of a Bitcoin, only public evaluation. If you participated as a bitcoin miner in 2011, then my assumption is that you were doing so based on your beliefs about the underlying technology, not to make money. Why should that change because other people perceive it as a get rich quick scheme?

                I defend my views vehemently because I'm still uncertain about them. The fate of Bitcoin is not guaranteed; and if all that people know it as is an energy-burning money machine, then it'll be much more difficult for me to stand behind it as a store of value in the future. As I start having more of these kinds of conversations in real life, I want to be well-prepared to respond to public perceptions and misconceptions. Informing neutral people is one thing, but changing people's minds is another.

                1 vote
            3. [2]
              nosewings
              Link Parent
              This simply is not how value works. If I spend a lot of time and energy digging a massive ditch on land that I own, that is in no way guaranteed to increase the value of my land. The mere fact...

              The thing that justifies Bitcoin's value is the several dozen terawatt-hours that are being devoted to it, not the number of dollars people will pay to get it.

              This simply is not how value works.

              If I spend a lot of time and energy digging a massive ditch on land that I own, that is in no way guaranteed to increase the value of my land. The mere fact that time and energy has been invested in something has no direct bearing on its value.

              6 votes
              1. zenen
                Link Parent
                That depends on the context. Why are you digging a massive ditch in the land you own? Either you want there to be a ditch, or someone else does - otherwise why would you put the effort in? If you...

                That depends on the context. Why are you digging a massive ditch in the land you own? Either you want there to be a ditch, or someone else does - otherwise why would you put the effort in?

                If you are willing to dig the ditch, then it has some non-zero amount of value which you think is worth the effort. That doesn't mean that it'll increase the resale value of your property, but if you invited me over to your property and said "dude, check out this ditch I dug" then I'd probably see what's up. I might even dig my own ditch, just for the meme.

                That said, this is all theoretical. If I was to actually dig a small ditch then that would provide some kind of tangible proof that I care about the rationale enough to act on it.

                1 vote
  5. randomperson
    Link
    I have a hard time imagining something more useless to humanity than a "bitcoin mine".

    I have a hard time imagining something more useless to humanity than a "bitcoin mine".

    16 votes