4
2
I will (probably) oversimply things, but I see it like that:
Gold linked currencies: someone stores in vaults the value of the circulating money (1) and that "real wealth" is safe to be eventually put again on the market and used for something useful (build microchips, drugs, or something else)
Fiat-currency: someone "prints" money for free (or almost).
Bitcoin: issuing currency costs as much electricity and equipment as the value of the issued BTC (2). Those resources are lost forever.
(1) or a fraction of it
(2) it is an approximation, since the cost of issuing BTC can be more or less than the value of issued coins, but it will not be far from it. If it is very profitable more people will mine, making difficulty increase, if it is hardly or not profitable people will stop mining making difficulty decrease.
Is it correct? Does it mean that bitcoin has burnt some billions of dollar worth of resources?
Did someone address this economical and ethical problem?
possible duplicate of Is there a way to set up proof-of-work systems so it would be even more useful?
– Colin Dean – 2013-11-07T13:37:41.097I like the part <<someone "prints" money for free>> – Seraphim – 2013-11-07T14:54:24.267
Related question: http://bitcoin.stackexchange.com/questions/592/will-the-amount-of-electricity-used-for-mining-be-huge-if-bitcoin-is-widely-adop
– Murch – 2013-11-07T15:38:59.7671Actually, there are costs to issuing cash: Resources such as ink, paper, and metal have to be procured, shipped, and processed/minted. Machines have to be build to create the cash. The coins and bills have to be shipped to banks, have to be counted, and checked for validity. Shop-owners have to drive to banks in order to deposit their earnings and to acquire change. Most people have to frequent banks in order to keep a sufficient supply of cash. Cash has to be replaced regularly in order to keep up with advances in counterfeiting. Claiming all of the above to be "almost free" is droll. – Murch – 2013-11-07T15:52:37.543
Related question: http://bitcoin.stackexchange.com/questions/13890/will-the-energy-cost-and-deflationary-nature-of-bitcoins-doom-the-currency-to-ob
– Murch – 2013-11-07T16:05:44.040