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MtnGoat
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PostMon Feb 12, 2018 6:00 pm 
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Interesting article. Paywalled at the WSJ, but you can find it cached if you're creative.

https://www.wsj.com/articles/rural-washington-is-a-hot-spot-for-bitcoin-miners-1518354001

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In Wenatchee, Wash., a bitcoin invasion is under way.

Home to hydroelectric dams that harness the flow of the Columbia River, north central Washington has some of the cheapest power in the U.S.

That has made the largely rural area best known for its apple orchards a magnet for bitcoin miners, who use powerful specialized computers to generate...


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zephyr
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PostMon Feb 12, 2018 6:57 pm 
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'See you added that extra pull quote.  I was just in the process of asking you to do that.  haha

I did a quick search and found yet another article reporting similarly on the same issue in Chelan County.  This article in Data Center Frontier titled "Bitcoin Miners Seeking Massive Amounts of Power in Washington State" seems to explain the situation and recent history going back several years.  I am not really sure I understand it that well to have an intelligent conversation about it.  But I can see from reading the article that it could threaten the power availability for the long time rate payers in the county.  ~z
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zephyr
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PostMon Feb 12, 2018 9:27 pm 
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Just now reviewing an article from the BBC on this.  Here's a video explaining bitcoin transactions:


From the article:  "It has previously been reported that the electricity demand of the world's total combined Bitcoin mining operations may now exceed the energy use of the Republic of Ireland, though this calculation may not be entirely accurate.

But as crypto-currencies rise in popularity, mining operations certainly continue to use more and more resources ...
"

My instincts are that this is something to be wary of.  huh.gif  I suppose I am old-fashioned, but this development is not encouraging for a number of reasons.  ~z
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Adohrn
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PostMon Feb 12, 2018 11:02 pm 
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Crypto-currencies as Pt Barnum would say “there is a sucker born every minute”.  While recently washing one of my bags at the local laundromat I became a captive audience to one of the patrons who mistakenly assumed I needed an in-depth education about it.  Ahhhhh!!!!!!!  Down takes a really really really really really long time to dry.
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NacMacFeegle
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PostTue Feb 13, 2018 10:38 am 
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The entire cryptocurrency market is almost sure to crash before too long. It really reminds me of a gold rush - people are staking their savings, picking up and moving to other places in the hope that they will strike it rich. The sooner it crashes the better - what a waste of power!

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Navy salad
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PostTue Feb 13, 2018 1:06 pm 
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zephyr wrote:
Here's a video explaining bitcoin transactions:

Great video that explains the whole concept in very simple terms!
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Joey
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PostFri Feb 16, 2018 10:01 am 
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I started reading up on this a bit and learned that there are also crypto currencies that are based on different technology ("distributed ledger") which do not involve any mining.  Examples include ripple, stellar, iota.
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Bootpathguy
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PostFri Mar 09, 2018 5:43 pm 
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Good article

https://www.politico.com/magazine/story/2018/03/09/bitcoin-mining-energy-prices-smalltown-feature-217230

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Joey
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PostFri Mar 09, 2018 6:50 pm 
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Good article indeed.
Thanks for posting.

I noticed the "correction" at the end points out that Ripple is not mined.
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Bootpathguy
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PostFri Mar 16, 2018 1:16 pm 
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Start'n to shut'em down

https://gizmodo.com/city-in-new-york-becomes-first-to-ban-new-bitcoin-minin-1823826338

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PostFri Mar 16, 2018 5:43 pm 
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John Oliver did an excellent job of explaining the whole Bitcoin Pyramid Scam.

He did not mention that huge data farms are mining the pyramid scam. 

The Dot.Com scam crash of the 90's will look like small change compared to this pyramid scheme crashing.    Of course the Dot.com crash took down a lot of valid tech startup businesses along with the scams crashing.

I guess they figured enough time had passed that all the suckers were ripe for the picking again.

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RandyHiker
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PostSat Mar 17, 2018 6:31 pm 
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Bitcoin is limited to a max of 21 million bitcoin and the structure halves the number of bitcoin yielded per block periodically.    So more and more power will be needed to "mine" bitcoin.   The sky high prices  currently make bitcoin mining profitable using PNW cheap hydro power -- It will be interesting to see what happens when investors realize that bitcoin cannot scale to become "the currency of the future"   Other blockchain cryptocurrencies have been developed without these limitations-- but whether these are feasable is highly questionable.   

Hitchhikers guide to the galaxy wrote:
let us move on to the subject of fiscal policy. . .”
“Fiscal policy!" whooped Ford Prefect. “Fiscal policy!"
The management consultant gave him a look that only a lungfish could have copied.
“Fiscal policy. . .” he repeated, “that is what I said.”
“How can you have money,” demanded Ford, “if none of you actually produces anything? It doesn't grow on trees you know.”
“If you would allow me to continue.. .”
Ford nodded dejectedly.
“Thank you. Since we decided a few weeks ago to adopt the leaf as legal tender, we have, of course, all become immensely rich.”
Ford stared in disbelief at the crowd who were murmuring appreciatively at this and greedily fingering the wads of leaves with which their track suits were stuffed.
“But we have also,” continued the management consultant, “run into a small inflation problem on account of the high level of leaf availability, which means that, I gather, the current going rate has something like three deciduous forests buying one ship’s peanut."
Murmurs of alarm came from the crowd. The management consultant waved them down.
“So in order to obviate this problem,” he continued, “and effectively revalue the leaf, we are about to embark on a massive defoliation campaign, and. . .er, burn down all the forests. I think you'll all agree that's a sensible move under the circumstances."
The crowd seemed a little uncertain about this for a second or two until someone pointed out how much this would increase the value of the leaves in their pockets whereupon they let out whoops of delight and gave the management consultant a standing ovation. The accountants among them looked forward to a profitable autumn aloft and it got an appreciative round from the crowd
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Freeski
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PostSun Mar 18, 2018 9:40 am 
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Interesting. Am I correct in assuming that the general public is in effect subsidizing the Bitcoin miners by having to pay for the electrical infrastructure and through increased cost of utility rates?

The whole idea seems to be to make money for the sake of making money without producing anything that benefits a community.

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PostSun Mar 18, 2018 4:23 pm 
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Freeski wrote:
he whole idea seems to be to make money for the sake of making money without producing anything that benefits a community.

It is a pyramid scheme, plain and simple.

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RandyHiker
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PostSun Mar 18, 2018 6:31 pm 
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Freeski wrote:
Bitcoin miners by having to pay for the electrical infrastructure

I don't think it's quite like that.  Bitcoin miners and big data centers by Google, MSFT and Amazon are attracted to the PNW because of abundance of cheap hydro power.  The power is cheap because huge capacity was built a generation ago to smelt aluminum in the vast quantities needed for military and then civilian aircraft production.   In recent years aircraft production has shifted to using composites and demand for aluminum is not what it was.

The infrastructure to share this hydro power with the rest of the country doesn't really exist -- there are transmission lines to California and the PNW does export some power to the south during the summer when AC demand in SoCal is at it's peak.

But "bulk prices" can be quite low -- especially for users like Bitcoin miners sign contracts to buy surplus power when demand is low.  Unlike other data center users, Bitcoin miners can adjust operations to reduce usage when other electrical grid usage is high.
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