[kictanet] World's biggest ever digital currency 'theft'

Kevin Kamonye kevin.kamonye at gmail.com
Mon Jan 29 15:39:28 EAT 2018 

Bitcoin and all other cryptos that utilise a prrof-of-work algorithm are a
good way to abuse the world's energy reserves and even worse they are
adding to the environmental crisis.

Let us break it down into the cost per transaction. Below are the current
estimates for the top 2.

Bitcoin Key Network Statistics
DescriptionValue
Bitcoin's current estimated annual electricity consumption* (TWh) 45.64
Annualized global mining revenues $10,382,095,434
Annualized estimated global mining costs $2,282,035,219
Country closest to Bitcoin in terms of electricity consumption Iraq
Estimated electricity used over the previous day (KWh) 125,043,026
Implied Watts per GH/s 0.24
Total Network Hashrate in PH/s (1,000,000 GH/s) 21,960
Electricity consumed *per transaction* (KWh) 481.00
Number of U.S. households that could be powered by Bitcoin 4,225,991
Number of U.S. households powered for 1 day by the electricity consumed for
a *single* transaction 16.25
Bitcoin's electricity consumption as a percentage of the world's
electricity consumption 0.20%
Annual carbon footprint (kt of CO2) 22,364
Carbon footprint per transaction (kg of CO2) 235.58

Ethereum Network Statistics
DescriptionValue
Ethereum's current estimated annual electricity consumption (TWh) 12.68
Annualized global mining revenues $11,562,678,694
Annualized estimated global mining costs $1,521,968,628
Country closest to Ethereum in terms of electricity consumption Kyrgyzstan
Estimated electricity used over the previous day (KWh) 34,748,142
Implied Watts per MH/s 7.884
Break-even Watts per MH/s (based on 5 cents per KWh) 59.893
Electricity consumed per transaction (KWh) 33.00
Number of U.S. households that could be powered by Ethereum 1,174,359
Number of U.S. households powered for 1 day by the electricity consumed for
a single transaction 1.12
Ethereum's electricity consumption as a percentage of the world's
electricity consumption 0.06%

src: https://digiconomist.net/bitcoin-energy-consumption

​Now factor in that these per transaction figures are for the miner that is
first in confirming the block. All the work done by the other min​ers is
mostly thrown down the drain.

Also these estimates are on the lower side. but even if we were to work
with 400KWh of power per transaction, relate that to how long you could run
your house with such a figure. On my part this would be a month of heavy
usage.

The reason i call this a waste is that there are better means of achieving
the same blockchain based trust without the PoW algos. The best candidate
so far has been Hashgraph but unfortunately the founders of this tech got
greedy and decided to patent it instead of releasing it as open-source.

All the same, there are other options that are still viable and hopefully
we shall see these being implemented to keep the blockchain dream alive.

Regards,

Kevin

On 29 January 2018 at 12:30, Robert Muthuri via kictanet <
kictanet at lists.kictanet.or.ke> wrote:

> We're probably trying to conflate different business models which won't
> work.
>
>    - With traditional financial systems you outsource your trust to a
>    middle man that then charges monopoly prices;
>    - with blockchain we're using mathematical proofing functions to gain
>    some 'trust' and currently suffer hacks until the tech matures.
>
> What are the costs of running the first system beyond normal running
> costs, 2008 financial crisis, plus factoring cost of regulatory compliance
> which has risen constantly, at least for the time i've been studying it
> (2012)?
>
> Also, what are the eventual benefits of blockchain applications allowing
> our entrepreneurs ease of entry which they'd otherwise not have,
> efficiency, transparency (read corruption and related governance issues),
> disintermediation and globalisation?
>
> Kind regards,
> Robert
>
> On Mon, Jan 29, 2018 at 12:09 PM, Sidney Ochieng via kictanet <
> kictanet at lists.kictanet.or.ke> wrote:
>
>> I don't know. Who is to say what provides value to people? If someone is
>> willing to pay for it, it's valuable therefore I wouldn't say its a waste
>> just because it doesn't provide value to me personally. Could that energy
>> be put to better use? Perhaps.
>>
>> On 29 January 2018 at 11:45, Adam Lane <adam.lane at huawei.com> wrote:
>>
>>> That energy has a purpose, and provides value to a consumer somewhere.
>>> The energy used in “mining a currency” provides no value at all, but is
>>> calculating sums for no reason other than to control supply of such
>>> currencies. It’s not to say that banks, data centers or ATMs should not be
>>> more energy efficient, but it is important to question why a process is
>>> designed to waste resources.
>>>
>>>
>>>
>>> *Senior Director, Public Affairs*
>>>
>>> *Huawei Southern Africa*
>>>
>>> Mobile: +254-7909-85886
>>>
>>>
>>>
>>> *From:* Sidney Ochieng [mailto:sidney.ochieng at gmail.com]
>>> *Sent:* Monday, January 29, 2018 10:37 AM
>>> *To:* KICTAnet ICT Policy Discussions <kictanet at lists.kictanet.or.ke>
>>> *Cc:* Adam Lane <adam.lane at huawei.com>
>>>
>>> *Subject:* Re: [kictanet] World's biggest ever digital currency 'theft'
>>>
>>>
>>>
>>> I find numbers like this thrown around without context mean nothing. How
>>> much of the worlds current energy is used on other financial transactions,
>>> running banks, credit cards, atms etc? Would anyone say that energy is
>>> wasted?
>>>
>>>
>>>
>>> On 29 January 2018 at 09:41, Adam Lane via kictanet <
>>> kictanet at lists.kictanet.or.ke> wrote:
>>>
>>> Let’s not forget the biggest flaw of all with crypto currencies is that
>>> they depend on basically wasting energy (Which may or may not be
>>> sustainably produced, even so it could be better used than on crunching
>>> pointless numbers):
>>>
>>>
>>>
>>> ·        *In 2017:*
>>>
>>>    - *42.67 TWh: The annual energy consumption of Bitcoin and Ethereum
>>>       combined*
>>>       - *0.19%: The percentage of the world’s electricity used by
>>>       Bitcoin and Ethereum*
>>>       - *8.49: The number of U.S. households that could be powered for
>>>       a full day with the same energy as single bitcoin transaction*
>>>
>>>
>>>
>>>
>>>
>>> *Senior Director, Public Affairs*
>>>
>>> *Huawei Southern Africa*
>>>
>>> Mobile: +254-7909-85886
>>>
>>>
>>>
>>> *From:* kictanet [mailto:kictanet-bounces+adam.lane=
>>> huawei.com at lists.kictanet.or.ke] *On Behalf Of *Admin CampusCiti via
>>> kictanet
>>> *Sent:* Sunday, January 28, 2018 6:12 PM
>>> *To:* Adam Lane <adam.lane at huawei.com>
>>> *Cc:* Admin CampusCiti <info at campusciti.com>
>>> *Subject:* Re: [kictanet] World's biggest ever digital currency 'theft'
>>>
>>>
>>>
>>> Lesson:-
>>>
>>>
>>>
>>> That we are not safe anywhere from thieves? :-)
>>>
>>>
>>>
>>> Seriously though one of the fundamental flaws of cryptocurrencies is
>>> that once you have been liberated from your cryptos you have no recourse.
>>> This is a design flaw that we are all hoping will be resolved. Sooner
>>> rather than later.
>>>
>>> *Ali Hussein*
>>>
>>> *Hussein & Associates*
>>>
>>> +254 0713 601113
>>>
>>>
>>>
>>> Twitter: @AliHKassim
>>>
>>> Skype: abu-jomo
>>>
>>> LinkedIn: http://ke.linkedin.com/in/alihkassim
>>>
>>> Blog: www.alyhussein.com
>>>
>>>
>>>
>>> "Discovery consists in seeing what everyone else has seen and thinking
>>> what no one else has thought".  ~ Albert Szent-Györgyi
>>>
>>>
>>>
>>> Sent from my iPad
>>>
>>>
>>> On 27 Jan 2018, at 8:53 PM, Victor Kapiyo via kictanet <
>>> kictanet at lists.kictanet.or.ke> wrote:
>>>
>>> Dear Listers,
>>>
>>>
>>>
>>> One of Japan's largest digital currency exchanges says it has lost some
>>> $534m (£380m) worth of virtual money in a hacking attack on its network.
>>>
>>>
>>>
>>> Coincheck suspended deposits and withdrawals for all crypto-currencies
>>> except Bitcoin as it assessed its losses in NEM, a lesser-known coin. If
>>> the theft is confirmed, it will be the largest involving digital
>>> currency. Another Tokyo exchange, MtGox, collapsed in 2014 after admitting
>>> that $400m had been stolen from its network.
>>>
>>>
>>>
>>> Read more: http://www.bbc.com/news/world-asia-42845505#
>>> <http://www.bbc.com/news/world-asia-42845505>
>>>
>>>
>>>
>>> What lessons can we learn from this?
>>>
>>>
>>>
>>> Regards,
>>>
>>>
>>>
>>>
>>>
>>> *Victor Kapiyo*
>>>
>>> Partner | *Lawmark Partners LLP*
>>>
>>> Advocate of the High Court of Kenya, Commissioner for Oaths & Notary
>>> Public
>>>
>>> *Suite No. 8, Centro House, Westlands, Nairobi | **Web:
>>> www.lawmark.co.ke <http://www.lawmark.co.ke> *
>>>
>>> ====================================================
>>> *“Your attitude, not your aptitude, will determine your altitude” Zig
>>> Ziglar*
>>>
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>>> The Kenya ICT Action Network (KICTANet) is a multi-stakeholder platform
>>> for people and institutions interested and involved in ICT policy and
>>> regulation. The network aims to act as a catalyst for reform in the ICT
>>> sector in support of the national aim of ICT enabled growth and development.
>>>
>>> KICTANetiquette : Adhere to the same standards of acceptable behaviors
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>>>
>>>
>>> --
>>>
>>> Regards,
>>>
>>> Sidney
>>>
>>>
>>> * Twitter:* @princelySid <https://twitter.com/princelySid> | *Web: *s
>>> idneyochieng.co.ke
>>> *Skype: *sidney.ochieng | *Github:* princelySid
>>> <https://github.com/princelySid>
>>>
>>>
>>>
>>
>>
>>
>> --
>> Regards,
>> Sidney
>>
>> *Twitter:* @princelySid <https://twitter.com/princelySid> | *Web: *s
>> idneyochieng.co.ke
>> *Skype: *sidney.ochieng | *Github:* princelySid
>> <https://github.com/princelySid>
>>
>> _______________________________________________
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>>
>> The Kenya ICT Action Network (KICTANet) is a multi-stakeholder platform
>> for people and institutions interested and involved in ICT policy and
>> regulation. The network aims to act as a catalyst for reform in the ICT
>> sector in support of the national aim of ICT enabled growth and development.
>>
>> KICTANetiquette : Adhere to the same standards of acceptable behaviors
>> online that you follow in real life: respect people's times and bandwidth,
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>> not spam, do not market your wares or qualifications.
>>
>>
>
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>
> The Kenya ICT Action Network (KICTANet) is a multi-stakeholder platform
> for people and institutions interested and involved in ICT policy and
> regulation. The network aims to act as a catalyst for reform in the ICT
> sector in support of the national aim of ICT enabled growth and development.
>
> KICTANetiquette : Adhere to the same standards of acceptable behaviors
> online that you follow in real life: respect people's times and bandwidth,
> share knowledge, don't flame or abuse or personalize, respect privacy, do
> not spam, do not market your wares or qualifications.
>
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