Iran Bans Crypto Mining After Months of Blackouts (gizmodo.com) 100
Iran banned bitcoin mining this week, after four months of continuous blackouts partially due to what officials say is a huge energy suck from illegal mining. Gizmodo reports: President Hassan Rouhani said at a cabinet meeting Wednesday that a drought in the region was responsible for crippling the country's supply of hydroelectric power. But, he said, the huge amount of illegal bitcoin mining that happens in Iran was tapping a staggering 2 gigawatts of power each day from the already-stressed grid. (Legal operations, meanwhile, used somewhere between 200 and 300 megawatts.)
Rouhani said around 85% of this 2-gigawatt power suck was from unlicensed operations. Iran has become a hotspot for illegal mining after many miners began to decamp there to take advantage of the country's heavily subsidized energy (partially due to the fact that Iran can't sell its oil due to international sanctions). Around 4.5% of the world's total bitcoin mining now takes place in Iran, making it one of the top 10 bitcoin-producing countries in the world. The crackdown by the government may knock it off the chart, but miners will surely sniff out another cheap source of electricity somewhere else in the world and set up shop there. [...] The ban in Iran will take effect immediately and be in place until at least September, officials say, and will include legal as well as illegal operations.
UPDATE: NBC News has additional converage — including these two interesting details:
Rouhani said around 85% of this 2-gigawatt power suck was from unlicensed operations. Iran has become a hotspot for illegal mining after many miners began to decamp there to take advantage of the country's heavily subsidized energy (partially due to the fact that Iran can't sell its oil due to international sanctions). Around 4.5% of the world's total bitcoin mining now takes place in Iran, making it one of the top 10 bitcoin-producing countries in the world. The crackdown by the government may knock it off the chart, but miners will surely sniff out another cheap source of electricity somewhere else in the world and set up shop there. [...] The ban in Iran will take effect immediately and be in place until at least September, officials say, and will include legal as well as illegal operations.
UPDATE: NBC News has additional converage — including these two interesting details:
- "Tehran allows cryptocurrencies mined in Iran to pay for imports of goods, which can help it get around the wide-ranging U.S. sanctions that had been imposed on the country..."
- "Around 4.5 percent of all bitcoin mining globally took place in Iran between January and April of this year, according to blockchain analytics firm Elliptic. That put it among the top 10 in the world, while China came in first place at nearly 70 percent."
"Continual", not "continuous" blackouts. (Score:1)
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Just using the English right.
You mean correctly? Or rightly?
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Cromulently.
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You should feel embiggened for your wry and timely use of modern American English.
Re: "Continual", not "continuous" blackouts. (Score:1)
Using it sexily.
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It's a lost cause -- you are addressing the "editor" who wrote that "NBC news has additional converage" (sic) of this covfefe.
Re:With China and Iran out of the game (Score:5, Insightful)
At some point people will realize they're just pouring money on something without real value, and the entire house of cards will plummet. It'll be spectacular.
The only thing driving cryptocurrencies prices up is the expectation of someone else to continuously invest and drive those prices up. In that sense, they're very much Ponzi scheme-like.
Fiat currencies always fail (Score:1)
As Voltaire famously said, 'Fiat currency always eventually returns to its intrinsic value -- zero.'
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That's not Johnny (Score:1)
Whatever helps you sleep at night, Johnny.
That's not Johnny, it's Pyrite Pete the bitcoin shitposter.
Re:Fiat currencies always fail (Score:5, Interesting)
Except that there very much is something backing fiat currencies: the ability of governments to levy taxes. Like corporations, they have income streams.
Also, FYI, but the long-term trend of inflation rates in major currencies has been very much downward over the past 50 years. To the point that a lot of economists have been concerned that inflation has been too low and have been pursuing policies to increase it. Inflation has both good and bad sides, and having some level of inflation is generally considered a good thing. It encourages investment, decreases the effective value of debt (which supports both borrowing and lending, something you want to happen alongside overall growth), and reduces the risk of deflation (which causes harmful purchasing-delay feedback cycles). Indeed, you don't have to have sub-zero inflation rates to suffer from the problems of deflation - individual components of the inflation rate can go negative while the overall rate is still positive, and the rise in productivity over time also leads to steady downward pressure on prices, which you need inflation to counter to avoid the paradox of thrift.
There's a balance to be made between numerous factors in an economy, and people go to college for years and then spend decades on the job to learn all of the nuance involved. But on the other hand, we have a bunch of techno-libertarians here to tell us that if nobody does anything whatsoever, why everything will just magically balance itself out on its own. Sorry, but that's not reality, and never has been, in the entire history of the world. You can see all the way back in Roman times when emperors had to step in with what was basically quantitative easing to rescue economies that have gotten out of whack. Economies are metastable. They tend to strike nice balances for a period of time, then something changes, and viscous feedback cycles develop. And with the rapid pace of today's economies, they can happen very quickly. It's important to study the economy, look for signs of developing viscous feedback cycles, and kill them in their infancy.
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In capitalist economies the competent folks are in the private sector.
Were you in a coma back in 2007?
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Inflation isn't necessarily bad and you point out several of the benefits of having a small amount of it, but the other thing to understand is that when you do have it
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Voltaire did not say that. He said "paper currency" in the original. By like argument, cryptocurrency is only worth the paper it is printed on.
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Re:With China and Iran out of the game (Score:5, Interesting)
Re: With China and Iran out of the game (Score:2)
Re: With China and Iran out of the game (Score:2)
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Do you remember where BTC value was mid-2020?
Look up the definition of "asset bubble".
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Your "world reserve currency" is irrelevant in the grand scheme of global finances. I mean that literally; the cryptocurrency market is minsucle. There's a reason why relatively small transactions still throw exchange values off by double digits.
Also, if you're suggesting that BTC value will continue to rise exponentially... well, i really hope you're not investing serious money on this belief. I really do.
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Like I said, you cannot expect it to go from 0 to world reserve currency overnight and in a straight line. This will take many more years.
Now look at a price chart with logarithmic price scale, zoom all the way out (I suggest the BLX ticker on TradingView for that), and tell me in which direction it is going?
Bitcoin is only 12 years into this journey, and it is still on track to its goal. Whether it will get there or not in the end, is the big question, but for now it
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Just like email something better came along
Just like AOL, something better came along
Just like myspace something better came along
Just like alta vista something different came along and took over anyway.
But bitcoin, that's here to stay. No one can ever make a better one.
#include "book_of_Pete.h"
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At some point people will realize they're just pouring money on something without real value, and the entire house of cards will plummet. It'll be spectacular.
The only thing driving cryptocurrencies prices up is the expectation of someone else to continuously invest and drive those prices up. In that sense, they're very much Ponzi scheme-like.
At some point people will wake up and realize the stock market, is not one fucking bit better with regards to that house of cards stability.
Not. Fucking. One.
House prices. New car prices. Stock prices. Crypto. Even medical bills. All of it is so disconnected from reality it makes Delusion look sane.
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Please. When i invest in the stock market, i'm investing in a company's future. That might end up working well or not, but it is very different than blindly throwing money into a bind gambling pit.
Right. And some of those companies don't even deserve to be listed. Multi-billion dollar valuations while deep in debt and may admittedly never turn a profit? "Meme" stocks? Markets where value is created and lost with rumor-mill grade tweets instead of sales/profit? Like I said, nothing is aligned with reality.
When you invest in American auto companies, are you investing in their ability to perform, or their ability to negotiate a Too Big To Fail bailout? Because we know where some "or not" investmen
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Re: With China and Iran out of the game (Score:2)
With the small assumption that the same 'math' of other stock market participants is wrong :)
Also some of the listed companies are BTC miners /traders /exchanges with steller stock performance since last few years. So I assume it's fine if I invest in these companies? Or should they be delisted?
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All fiat currencies have no "real value" other than confidence of a market. Value is generated with every transaction but continues to exist only as long as there exists a demand for and a belief in the value.
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Real currencies are not traded like a speculative asset.
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Yes they are. US dollars in particular are traded this way although often by maintaining US dollar bank accounts to mitigate trade exchange risks. Not really any different except that currency speculation is held in check by central bank monetary policies. ie: The market has a belief that the major stakeholder in a currency will operate in the market to stabilize the currency. Lots of examples in history of "real" currencies being traded speculatively.
Stateless crypto currencies have no identifiable s
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It'll be spectacular.
For whom? The sad part here is that gullible normal folk will be left holding the bill while speculative investors and miners have already hugely profited and fucked the environment as they went.
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For everyone. I'm not saying it will be great though - a lot of people will learn a (very expensive) lesson in the process.
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But what it will do for the price is anyone's guess. It swings 25% or more every time Elon farts, so...
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It also means transactions, which are already horribly slow for most cryptocurrencies, will become even slower. I could see that deterring people looking into BTC et all as an investment (which is pretty much everyone nowadays), specially with the wild value swings these tend to go through.
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https://www.blockchain.com/cha... [blockchain.com]
I love how the "let's have decentralized finances" crowd solution for this problem, which is intrinsic, is just to build layers and layers of independent transaction networks.
Congratulations. You've just rediscovered banks.
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You are confusing a "final settlement" which is something available with our Central Banks, and takes weeks, and you as a private citizen can't have access, with a PayPal transaction that could be reversed.
No, i am not (and what the hell do you mean with "final settlement" in this context?!). Lightning networks and other similar solutions are simply separate transactions network, with their own "pool" of currency, which then eventually clear into the main blockchain. Hell, they even have the concept of an watchtower entity, just to prevent the possibility of fraud. If you don't see the parallels with banking, well, i guess it sucks to be you.
PS: The inability of having transactions cancelled for most, if not
Re: With China and Iran out of the game - Really? (Score:2)
"Inability" to reverse transactions?
That's actually the "ability to ensure no one can reverse transactions"
Just like your inability to reverse $100 cash paid to someone.
In both cases you can still go to court with proof of receipt etc and get it reversed if the court decides you were defrauded etc
Without this inability there is no use of BTC.
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Yes. The ability to cancel/reverse transactions is one of the most overlooked benefits of our current banking system, and BTC parting with it is a regression. Mistakes happen. Fraud happens. Scams happen.
Hell, remember back in the mid 80s when credit card companies made you liable for bogus charges?
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I also love the fact that in order to get them to work efficiently (unlike the horridly inefficient base layer) is to add in centralization (for example with lightning, watchtower nodes).
Most of the more efficient cryptocurrencies are themselves centralization-in-disguise. XRP's security, for example, has a master list of trusted validators, and since by default so many people will be using that master list, that if any validator's answers deviate from what the master list validators are saying, they're al
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I also love the fact that in order to get them to work efficiently (unlike the horridly inefficient base layer) is to add in centralization (for example with lightning, watchtower nodes).
Yup. In fact, most (if not all) exchanges are built on this idea, which is why every now and then one kicks the bucket and someone runs with all its members funds.
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Lightning has an unsustainable cost of liquidity currently bourn by hobbyists running nodes and an is painful/unpredictable to use without massive centralization creating big "exchanges" which actually provide decent service.
Of course if you centralize on "exchanges" you might just as well use a normal exchange to trade off chain, which doesn't have the unsustainable cost of liquidity.
There's more bitcoin locked up in defi scams on the Ethereum blockchain than on Lightning. Lightning will never stop being a
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It won't decentralize, it will always centralize where it's cheap until it's no longer cheap.
It just never lasts long, no sane country/region wants private crypto ... they allow it out of inertia. A big aluminium plant needs permits, they can do some central planning to match supply with demand. Crypto comes down like locusts and fuck up the local grid before local government wakes up.
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Biting the hands that feeds it (Score:1)
Cutting the nose to spite the face.
Yep. That's Iran. Being stupid since ... well, forever.
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If the cure is worse than the disease, you find a different cure.
Nobody in the modern world can afford to have unreliable power. It kills people.
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Yep. That's Iran. Being stupid since ... well, since western powers overthrew their fledgling democracy for more profitable access to their oil
FTFY
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Well that's a rather imperialist view, but do you think the imposition of what you consider to be unreasonable taxes would justify the organization of a coup against the government?
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Well that's a rather imperialist view, but do you think the imposition of what you consider to be unreasonable taxes would justify the organization of a coup against the government?
That depends on whether you have the support to win or not. If you win, you are George Washington... if you lose, you are Donald Trump.
"You've got to ask yourself a question: 'do I feel lucky?' Well, do ya, punk?"
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The problem with cryptocurrency in general (Score:3, Insightful)
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The proof of work problem is already solved. Modern crypto is moving to proof of stake. This brings new problems but solves the problems associated with using up a ton of electricity to do the work and instead allows people who have staked capital to validate transactions (very simplified).
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The fact that cryptocurrencies fundamentalists' single argument when confronted with this reality is "s'all good, we'll just use green energy" is really telling. They can't, or don't want to, grasp how much of a fundamental issue energy consumption is.
That a couple miners in Iran were taxing the power grid with 2 gigawatts of constant draw is just insane.
There's way more problems than that (Score:2)
And with or without mining tracking transactions on the ledger quickly becomes intensely computationally expensive. Huge parts of China's data centers are used just to process transactions.
The protocols are fundamentally inefficient and high risk. They only took off because they were ver
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It's not just the consumption that is a problem.
The fact that if you have resources you can mine more out of thin air is a problem. Instead of rewarding hard work or ability, it rewards already being rich.
Crypto-miners are assholes (Score:2, Insightful)
In Iran, it is just more obvious than elsewhere. But these people do massive damage and generate nothing in return (the cryptocurrency scam is zero-sum), except for bankrupting some people, which they den expect society to pay for. The whole thing is completely repulsive and destructive.
Exception: Proof-of-stake based things may eventually provide some benefits.
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Proof of stake is not without issues though. "Let's have those with more currency decide which transactions are legit and which are not" is an... interesting strategy to take.
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I agree. And proof-of-stake can also be bad for the environment, for example when people have to buy tons of storage to do it that otherwise would go to some reasonable use.
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Exception: Proof-of-stake based things may eventually provide some benefits.
To whom? Regardless of the energy or effort required the fundamental problem is that the advertised benefit of a central monetary scheme isn't actually a benefit at all. There's a reason governments abandoned standard currency, the ability to enact monetary policy to regulate an economy is critical to modern society. You can see evidence of that way back to the great depression where the economies hit by far the hardest and longest were those not on fiat currency because the government had few levers to try
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That is why I wrote "may". It is not yet clear what can and cannot reasonably be done with these things, _besides_ doing a cleverly camouflaged pyramid-scheme. Note that proof-of-stake does not imply "fake currency".
Illegal Mining? (Score:2)
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FTFA:
Seeing as the unregistered (illegal) miners are using ten times as much electricity as the registered (legal) ones, I'm guessing that the cost of complying with the law is more than the cost of bribing government officials to ignore your unregistere
And yet (Score:2)
https://www.reuters.com/techno... [reuters.com]
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Just because it has some positives doesn't mean the negatives can't crowd it out.
Causing blackouts to manufacture nothing (Score:2)
Notice the irony? (Score:2)
One of the whole points of crypto was it wasn't an officially sanctioned activity and didn't need government approval. And yet in Iran you apparently need permission, in effect, to use crypto.
I don't get it (Score:2)
Why not making it official?
With plenty of oil and no way to sell it, at least they can make bitcoin with it if it's not causing blackouts. They even save on transport, no tankers nothing.