Quote from: BitLex on April 24, 2011, 03:33:16 AM

and about inefficiency and wasted energy:

what amount of energy is wasted to produce the so called 'real money' ?
what amount of energy is wasted by all those security- and computer-systems that watch over the so called 'real money' and keep track of and allow transactions?
what amount of energy is wasted producing and driving around thousands of big armored trucks with armed guards to transport that so called 'real money' from Alice to Bob?

nothing real is produced by that huge amount of energy.
besides that you even pay your bank and government to waste it, how silly is that? Cheesy

the small amount of energy needed to keep the bitcoin-network going doesnt even get close to a fraction of that.

That is precisely the thing though, you would expect a great deal of energy to be wasted in the protection transfer etc of 'real money' but it does not follow or seem immediately obvious that the same should be the case for virtual money.

I definitely agree that the energy required by the bitcoin network is a fraction of that expended by banks etc and everything that involves. What I think is interesting however is whether the amount used by bitcoin is necessary. If bitcoin takes off and becomes more mainstream (which I think it definitely has the potential to do) this issue may become more relevant. As the number of bitcoins generated tends to 21m (or however much it is) and the difficulty increases (compounded by a larger, crowded user base of miners), who is to say what the global energy expenditure on bitcoin mining will be? C/GPU time - thus energy - appears essentially wasted when the computer is completing the task of 'hashing' or what not that has been made more difficult to complete as a method of curbing the production rate of btc.

I don't know precisely what proof of work entails but if it needs to be beefed up or elongated to slow down the rate at which btc is generated then surely the 'filler' could be some computation that is of greater general use? Like folding proteins or working out further digits of some transcendental number or something! Perhaps I can't see the wood for the trees but it seems extraordinary that wastage should be intentionally built into a system. I'm not picking on bitcoin in particular, just in general the idea that it is self-imposed perplexes me.

I'm no genius and have no answer as to how to complete the same task more efficiently, but supposing that raising the difficulty is necessary to stem the rate of btc generation then perhaps the 'filler' or whatever that makes the task more difficult could be replaced or interspersed with genome sequencing or protein folding or something?