Bitcoin / Bitcoins

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  • And I agree, avoiding paying taxes seems to go hand in hand with the ideology of many in crypto

    Aye, well, in the U.S. at least there's a big overlap between Crypto bros and alt-right libertarians, sovereign citizens etc. Of course, since one of the most common beliefs touted by them is that the universal adoption of BTC will get rid of the IRS, banks and central government, they may just be counting on the risk going away.

  • I think this is overstating it. There's a 20 year discovery window for HMRC to assess tax affairs due to deliberate action, use of a hallmarked tax avoidance scheme or (and this is the one that I think could get lots of people) failure to notify liability.

    Those rules are pretty complex but I'd be very nervous about thinking undeclared income or gains are in the clear after 4 or 6 years, and if you suspect you have undeclared income or gains then the period is probably extended anyway as your failure to pay tax is arguable more than just careless, it's deliberate.

    Yup, fair enough. Thought it would be clear that deliberate tax dodging is something you can't hide from. I did say in my post that there are different rules for deliberate acts.

    I was more thinking about the fact that the crypto rules for tax are rushed, poorly thought out, poorly explained, inconsistently applied and poorly enforced means that if you're doing your best, declaring everything and paying what you and your accountant think you owe you probably shouldn't have any sleepless nights.

  • Yeh, a lot of them have a lot of love for The Sovereign Individual by Rees-Mogg Senior

  • Analysis of the paper with a lot of criticism of the model and assumptions. https://youtu.be/OIk81gsF9wE

  • Meanwhile, sourcehut CI is removing unpaid access to any of its services to try and combat crypto mining and boy, is the owner pissed off about it.

  • I did some Bitcoin chat on our podcast today: https://twitter.com/Sparkes/status/13905­87168918327298

  • Is there a 'green' coin?

  • Not really. I'm digging into the whole issue for a longer feature though, so if anyone comes across anything I'd love to know.

  • This is worth a look, presuming you've not seen it already:

    https://squareup.com/us/en/press/bcei-wh­ite-paper

    I find the 'Bitcoin-energy-usage-equals-X-country' argument pretty tiring. I wonder how many countries-worth of carbon emissions global gold extraction equals? Or how much electricity is squandered by global banks leaving their lights on over the weekend? All feels a little besides the point, on a macro scale...

  • I find the 'Bitcoin-energy-usage-equals-X-country' argument pretty tiring
    ...
    All feels a little besides the point, on a macro scale...

    Doesn't that miss the point too though?

    There's a purpose to mining gold. It's useful for making things.
    Banks leaving the lights on is definitely a waste, but there was a reason to have the lights in the first place.

    Bitcoin is solving hard maths problems for no purpose other than to create the coin. If the work being done was protein folding, or weather prediction (ignoring the irony), and you got a token to show you'd done the work and that entitled you to a % of a bitcoin then you could argue that the the mining itself was more than an exercise in vanity.

    I definitely don't know what I'm talking about compared to the Stonehenges on the thread, but I've yet to be convinced that Bitcoin isn't a shitshow on a number of levels.

  • Whether it's useful or not it's using 0.65% of the world's electricity. So I think it's perfectly valid to be asking if it can be made more efficient. I think it's too easy and simplistic to demonise it but the truth is it's gobbling up energy like it's going out of fashion.

  • AYe but people don’t give two flying fucks when it comes to making truck loads of cash sadly

  • Verifying the ledger through hard maths problems is very useful. It's enabling the world's first completely decentralised network of monetary exchange to stand up as a valid store of value. If you don't think we need that, then read this: https://fee.org/articles/reuters-cash-di­sappearing-in-venezuela-despite-hyperinf­lation/

  • I wonder how many countries-worth of carbon emissions global gold extraction equals?

    Gold only has to be dug up once and then can sit in a vault while being used in any number of transactions. The initial cost is increasingly spread across those transactions, in this sense. BTC's cost per transaction, on the other hand, increases constantly.

    Or how much electricity is squandered by global banks leaving their lights on over the weekend?

    1. Again, a tiny cost compared to the total cost of BTC.
    2. When you spread it across the number of transactions those banks carry out, compared to the relatively tiny number of BTC transactions, it becomes microscopic.
    3. Fiat currency doesn't depend upon office lights being turned on.
    4. Banks actually do a lot more than create and store fiat currency. Despite what the more delusional members of the cryptocurrency community think, if the world switched to cryptocurrencies tomorrow, there would still be banks.

    All feels a little besides the point, on a macro scale...

    BTC's energy costs are on a bloody macro scale.

  • There's a purpose to mining gold. It's useful for making things.

    True, but it's mainly useful for making things like rings which don't really serve a purpose

  • Gold only has to be dug up once and then can sit in a vault while being used in any number of transactions. The initial cost is increasingly spread across those transactions, in this sense.

    What transactions are these? I hope you don't mean gold-backed currency transactions, because that's not a thing anymore...

  • Gold is still traded and more frequently than BTC.

  • Likely true for now, but it's changing fast (the market cap of BTC is already more than 10% that of gold). And the relative worth of BTC 'trading' has the potential to be of far bigger value to society than gold trading.

    This is worth a read if you're interested: https://hbr.org/2021/05/how-much-energy-­does-bitcoin-actually-consume?utm_source­=pocket&utm_medium=email&utm_campaign=po­ckethits

  • An article containing some basic misunderstandings of BTC, as in

    The vast majority of Bitcoin’s energy consumption happens during the mining process. Once coins have been issued, the energy required to validate transactions is minimal. As such, simply looking at Bitcoin’s total energy draw to date and dividing that by the number of transactions doesn’t make sense — most of that energy was used to mine Bitcoins, not to support transactions.

  • It’s a shame that’s all you took from it.

  • Mining creates blocks. Transactions depend on blocks. Without the block, the transaction doesn't happen. You can't separate the energy used to create the block from the transactions and say the transaction cost is something else. It's like saying the cost of moving train passengers from London to Edinburgh is just the cost of printing and stamping their ticket.

    Oh, ninja edit on your part, removing the "Why is that bollocks?" bit.

    It’s a shame that’s all you took from it.

    It wasn't. There's more bollocks.

  • I can’t claim any expertise but I found Drew DeVault's recent blog post and this article interesting

    https://www.rferl.org/a/bitcoin-blackout­s-russian-cryptocurrency-miners-minting-­millions-sucking-abkhazia-electricity-gr­id-dry/30968307.html

  • It’s a shame that’s all you took from it.

    So, you kicked this off by wondering how much it costs to get gold out of the ground and counting the cost of the lights being left on in offices as part of the cost of fiat currency. But you followed it up with an article in which the second of the two arguments is titled

    Mining Bitcoin Consumes a lot More Energy Than Using It

    and claims that the energy cost of Bitcoin is almost all used to create coins and has nothing do with transactions.

    Because that's a hugely hypocritical argument for you to be endorsing. It's also bullshit.

    1. Proof of Work is necessary to create blocks.
    2. Transactions depend upon blocks.
    3. Creating a block currently also creates coin, although that will stop one day.
    4. Even after the final coins have been created, blocks will still be being mined because that's how transactions are logged and (unless Proof of Work is replaced or somebody proves NP = P) the computational cost of transactions will still be rising.

    The other argument in the article is also crap but not such blatantly, delusionally wrong crap. Bitcoin mining could form symbiotic partnerships with green energy or carbon neutral plans but right now it isn't because there's no incentive. Even if they did, most of the energy would be going on mining an not to the rest of the world. BTC would be massively increasing the energy requirements of the world economy and the whole of the rest of the economy using the smallest portion. It's not a good thing to pair BTC mining with carbon capture/offset schemes either - it creates an ongoing incentive for the damaging energy creation technologies (e.g. coal mining) to continue, when the existing climate change conventions are based on phasing them out.

    Not to say that there might not be a way to make BTC a useful rather than a damaging energy client, but all that article does is repeat the same vague, hand-wavy hopes that Bitcoin bros spout every day to try and evade the argument.

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Bitcoin / Bitcoins

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