CONTENT WARNING: I am literally not an expert in anything and everything I say here could be dead wrong on multiple levels, so take that under advisement before you start to panicking, OK? I look forward to comments that will temper my doomsaying.
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I was contemplating NFTs and crypto thanks to the latest episode of James Stephanie Sterling’s program and a rash of posts on tumblr besides, and I realized they are a perfect analogy to the cause of multiple extinction events on the planet. Then I realized they aren’t just analogous – they could really be the straw that breaks the back of civilization. This connects to my theory about how the rest of human history is likely to go: Cyberpunk Dystopia, Post-Apocalyptic Wasteland, then Nothing. If world leaders want to forestall the end of their power, and if I’m right, they’d best do everything in their power to outlaw criminalize and expunge blockchain-based currencies from existence.
It works like this: All you need to do to make money from nothing is run a computer for a while. Cool trick, eh? It generates encrypted information that can be exchanged for goods and services. Now think about this for a minute.
Right now every con artist in the world is working every angle in the world 24-7 nonstop, from Mumbai to Macedonia, to raise every red cent they can. They’ve all but destroyed the ability of senior citizens and the disabled to use phones, to use email. Colonized people across the planet have become the vehicle of their own destruction, razing the forests to ash just to get by in whatever economy has been left to them. Corruption is so widespread and thorough in the “socialist” countries that their infrastructure is inflicting mass casualty events left and right. And the finance industry in the USA, every time it’s been let off the leash even an inch? Has pushed us to the brink of utter economic disaster through money-making schemes so byzantine in complexity and somehow as utterly mindless as an amoeba.
Humans work angles. But so has all life, since inanimate proteins first started to become something we could consider life. The cutesy educational program PBS Eons has multiple episodes that have this theme and it really puts our coming destruction in perspective. Basically a type of life finds a niche that allows it to grow out of all bounds. Unknowable trillions of organisms in the primordial ocean have effected climate change so dramatic it turned the oceans purple once, it turned the Earth into ice planet Hoth once, and it caused multiple devastating extinctions – some before the evolution of the world’s first nervous systems. Eons always puts a positive spin on it, saying “without this (unspeakable death and horror) that came before us, we wouldn’t be here. Isn’t that swell?” But there it is: under global capitalism we are recreating the biosphere-wrecking mistakes of literally mindless creatures that came before us.
Now all you need is a computer to run for a little while to make money out of thin air. Huzzah! This can of course lead to various cryptos being devalued into nothing, but all you have to do to sidestep that is to create a new crypto. It works even better than cruzeiro bills because those are obliged to have some relationship to the currency of Brazil. Now when you’ve devalued your currency to nothing all you have to do is make a new virtual country.
All of this is, of course, environmentally destructive. Every crypto dollar you create requires a certain amount of energy to perpetuate its existence. Every dollar created within a currency gradually gives less value return than the cost to maintain its own existence, but they never stop existing. There’s no landfill for these barrels of funny money. So essentially the crypto gold rush only makes money as long as each currency is maxed out in sequence, and new ones are constantly created.
Multiply this by every spam email farmer from Manila to Johannesburg and the problem becomes more clear. The creator of crypto may as well have been Tyler Durden, out to destroy the world’s economies in the pursuit of anarcho-primitivism, because nobody in the world can stop this. A system has been created that allows everybody in the world to build a tottering carbon-sucking Tower of Babel that absolutely will collapse, and like nuclear proliferation, nobody in a position to stop it has the courage or self-control to do so. It’s the monkeys in the old commercials pushing the “crack” button to the exclusion of the “food” button until dead.
Something changed recently. I don’t know what, but suddenly “venerable” financial institutions have decided crypto is legit, and are pushing crypto cards, crypto retirement accounts, crypto everything. Why wouldn’t they? These are the people who caused the Great Depression and every financial crisis since. It’s all about mindlessly rushing to squeeze every penny out of every angle until the whole thing collapses, while everyone with an ounce of awareness knows this exploitation just wheels us from one collapse to the next.
Now the video game industry is wanting in on the con, wanting to turn gamers into crypto miners for them. You think they’re the only internet connected industry that will do this? The literal internet providers are coming next. Funny thing is, they might not even know they’re doing it. Here’s why: The same corruption that ransacked the infrastructure of China is waiting to go platinum in the US of A. Crime organized and otherwise is going to infiltrate any corporation with access to server farms and steal bandwidth to mine crypto. And of course, there’s nothing to stop the telecoms themselves from doing a certain amount of crypto mining right out in the light of day.
Our internet will slow to a crawl and start to experience massive outages, and with it our civilization – now hopelessly dependent on it. In my little quasi-marxist progression of history, this is the Cyberpunk Dystopia. This era will end when the internet ends, heralding the Mad Max era. Crypto-currency, if it isn’t defanged through an international blitz, could well be the force that flicks that off switch.
Tell me I’m wrong, please.
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There’s no “going to” about it, this is already happening. Plenty of websites and apps have crypto calculations running in the background on your device. Better hope whoever maintains that app you like doesn’t get an offer they can’t refuse, and keep your javascript blockers up to date.
Long gone are the days when ordinary rigs could mine bitcoin. These days, it’s dedicated hardware. No gamers are going to be unwitting miners, their boxes just don’t have the grunt.
(cf. https://www.buybitcoinworldwide.com/mining/hardware/)
Also, the bandwidth required (aka the internet load) is negligible (around 360Gb currently for the blockchain, where the Internet currently handles over 600Tbps). There are roughly 30 of them currently active worldwide.
And a blockchain is basically just a distributed ledger. Not magic.
I don’t know if this makes you feel any better, but we’ve been destroying our biosphere long before cryptocurrencies were invented; so they won’t have that noticeable an effect on what’s already been going on independent of them. There’s LOTS of scams and “angles” going on all over the place at once, and either one of them can later be seen as “the last straw.”
I’m no crypto fan, but they’re not THAT evil.
The government of China, having more foresight than most others, recognized cryptocurrency as a threat to its hegemony and banned it, hard.
Every other government which values its control more than its own corruption will eventually have to follow suit.
Which will prevail? Tune in next week(s) for the next episode(s) of
CivilizationLife in the Balance!From my understanding, the problem with crypto, at least bitcoin, is the use of proof of work and the increasing difficulty (the amount of computation needed keeps increasing as more bitcoins are mined).
Now the amount of energy consumed for one single bitcoin transaction is well over 1000kWh (I’ve seen between 1100 and 1800 quoted on a quick google search) which is an insane amount of energy for what is mostly pure speculation (basically gambling) or illegal transactions.
For comparison, that’s about 1 million times the amount of energy needed for a Visa transaction which is most likely to be a legitimate transaction (and likely mostly comes from infrastructure needs not a per transaction computation need).
I think I only know of one place I could spend cryptocurrency and on one specific product. Anything else is someone who isn’t selling me anything. They just want to be a money changer. Which means they think they’re better at finding some sucker to give them value out of it than I am.
When you can pay rent or buy food at the grocery store with it, it’ll be a real financial catastrophe. Until then, or maybe until you can live the good life and pay for it with cryptocurrency, it’s going to remain a niche part of the market. Too niche to matter.
Ianir, I used to believe as you did, that this was always going to be niche.
Then, just yesterday, a gas station I often use had a “Cryptocurrency ATM” neon sign in the window.
When I first heard about this back in the 90s, I felt like it was a bubble in the making, a pyramid scheme that would move money around between suckers until it all crashed.
I still feel that way. The longer the crash is delayed, the bigger it’s going to be when it comes. But I hope it comes soon.
This is all well and good. I’d address specific comments but I likely won’t get time, but I appreciate all. Thanks.
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@Jean #5
This is an argument I hear a lot from crypto advocates, but I don’t buy it. If moving from proof of work to proof of stake reduces the power requirements by a million times, that’s great on a per transaction basis, but when miners have all this processing power available do you really think they won’t use it to just mine a million times more than they did before? As long as more power in equals more money out, they’re going to use as much power as they can.
And that’s on top of the whole switch to PoS being perpetually “sometime next year” for ages now. Like fusion power I’m going to have to see it before I believe it.
The problem with mistaking proof of labour for proof of value is this:
Mark meets Alice, looking somewhat glum.
Alice: “I asked my landlord, Bob, to repaint one of my rooms. Bob’s abroad, so he promised to pay me £100 if I bought the paint and did the job myself, and sent him the receipt for the paint and this photograph of the completed job with the empty paint tins in shot as proof. But he won’t be home with the money till next Thursday, and I’m left short until then.”
Mark: “I’ll give you £25 for that picture and receipt!”
Alice: “No way! I’m not that desperate. £75?”
Mark: “£50, and that’s my final offer.”
Alice: “Done!”
(Next Thursday)
Mark: “Hey, Bob! You know that ton you promised Alice if she painted her room herself? Well, I’ve got the receipt for the paint and a picture of the work here. She’s made quite a good job of it, too!”
Bob: “Who the f**k is Alice?”
Dauphni,
That’s not how mining works. To do a million times more mining you would need to have a million times more transactions. The number of transactions is not dependent on whether PoW or PoS is used. So if PoS is more power efficient (which it is but probably not as much as a Visa transaction which is a commodity) then PoW should be dumped as soon as possible. But I don’t know when that will come for Ethereum (supposedly 2022 now) and I don’t think there is any plan or even a possibility for Bitcoin to go PoS.
One more problem with PoW in addition to the huge power requirements is the amount of hardware needed. In a time of chip shortage, that is not a good thing. Bitcoin uses specialized hardware but other cryptos use consumer hardware which is no longer available to consumers (graphics cards). And even the specialized hardware does need to be fabricated using the same scarce manufacturing resources.
I also can’t shake the thought that perhaps money itself is an idea whose time has been and gone. While I’ll freely admit that we probably wouldn’t have built the civilisation we have if we had never invented money, I also know how scaffolding gets in the way after a building is completed; and there are certain programming techniques you have to use in a bootstrap loader that you wouldn’t want anywhere near a multi-user, networked system. The invention of the switched-mode power supply (which makes DC power distribution feasible) would never have been possible without an electronics industry whose development was only made possible by the existence of AC power grids. So it’s not a totally absurd premise.
Money was a tool for managing scarcity. And since the Industrial Revolution, we live in an age of abundance. Anything digital is inherently non-rivalrous (i.e., not diminished by the act of sharing: if I give you a copy of something, I still have the original); but even many physical goods are cheap enough to consider effectively non-rivalrous, especially so if they are either rapidly biodegradable or fully recyclable. We know how many people there are in the world. We can work out exactly how much of everything is required to satisfy everyone’s basic needs, and how much labour is required to manufacture it.
So I say: Automate every job it is possible to automate, divide up the residual labour fairly among the whole population and make sure everybody does their allotted share no matter how unpleasant the work. (This sounds a bit like coercion, but society already only works if everything gets done, and right now there are some people who are definitely not pulling their weight. And the question then becomes: Is forcing someone to work for the sake of society worse than condemning them to live in a society that is not the best it could be?) And when your share of the work is done, you become free to concentrate on your own dreams. Don’t like the free house you got given to live in until you die? Build another with your allotted share of the Earth’s resources!
Working twenty hours a week and retiring in your thirties doesn’t actually sound like a bad life …..