Bitcoin an even bigger waste of energy

by John Quiggin on December 4, 2017

I gave a talk yesterday at a Colloquium organized by a group called Sort, on The Wasteful Economics in Resource Recovery, and I was asked to talk a bit about blockchain technology. That reminded me that I needed to take another look at the issue, and what has changed since 2015 when I wrote that

at most of the market value of a Bitcoin reflects the electricity wasted in the calculations needed to “mine” it, with the obvious disastrous implications for the global climate.
and concluded that the sooner this collective delusion comes to an end, the better.

As far as I can determine, the only thing that has changed is that the Bitcoin bubble has got massively bigger and that the associated waste of energy is now much more widely recognised than when I first wrote about it.

Despite the huge increase in the market value of bitcoins, they seem further than ever from becoming an actual currency. Unsurprisingly, there’s no sign that governments are willing to accept bitcoins as legal tender. Nor is there any sign that they are displacing standard forms of money. On the contrary, bitcoins now seem to be seen as a financial asset, with no real suggestion that they will ever be a general medium of exchange.

As a check on this, here’s a list of firms that accept bitcoin as payment, which fits easily on to a single page. Sydney readers who would like to buy a beer with bitcoin are in luck, or were back in 2014 when the Old Fitzroy got a bit of coverage for saying it would accept bitcoins. There’s another pub listed in London, and that’s about it as far as drinks are concerned. After nearly a decade, Bitcoin acceptance remains the stuff of publicity stunts, not a serious commercial option.

At least by repute, bitcoins are used more extensively in covert transactions such as those involving drug trading, tax evasion and money laundering. But that’s scarcely a good reason to bet on them being around for a long while. If the scale of the problem gets large enough to cause real problems, governments will act to shut the whole system down or regulate it to the point where the compliance costs make the whole idea unattractive.

At any rate, the durability and magnitude of the Bitcoin phenomenon, running for nearly 10 years and with a putative value of nearly $US 100 billion, provides us with a very sharp test of the Efficient (financial) Markets Hypothesis. If Bitcoin eventually becomes a currency, the EMH and its supporters will be vindicated, and I (along with quite a few other economists) will have a lot of egg on my face. If the bubble bursts, the roles will be reversed.

Finally, I should give a plug to Gridcoin. This is a project that aims to avoid the massive waste involved in Bitcoin by making calculations that are actually useful to science. This is a worthwhile idea. But with a current market capitalization of $21 million, it’s obviously got a long way to go.

There are also alternatives to the “proof of work” method of validating changes to the blockchain, such as “proof of importance”, which is analogous to Google’s page ranking systems. I’m still trying to find out more about these.

{ 49 comments }

1

Chet Murthy 12.04.17 at 3:27 am

John, the “intellectual basis” of BTC/ETH, in proof-of-work, is itself a confidence game. And it’s easy to see that: there’s nothing decentralized at all about it, and people who think there is, are fooling themselves. The DAO hack should have been convincing evidence of this, if that were needed.

At the end of the day, *no* consensus protocol (not PoW, not PoS, not any putative BFT protocol) can avoid the need for a coordinating central authority: the one that decides what current software version everyone will run. The only question is whether that central authority will be Vitalik and his droogies”, or a legally-constituted authority with legally-enforceable contractual responsibilities. The eagerness of financial firms that choose their incorporating domiciles based on the advice of general counsel, to “invest” (== speculate) in this stuff, is proof that they’ve all lost their heads.

And the minute you no longer believe in the “decentralized consensus” bullshit, there’s nothing to distinguish it from … fiat currency.

And I’m not even an economist — economists have made careful cases for why this stuff is bogus. But as a computer scientist, I stick to my knitting, and the CS case is a confidence trick.

2

Glen Tomkins 12.04.17 at 4:33 am

I suspect that when they came up with the EMH, unused wealth was not in such massive oversupply as it has been lately. There isn’t nearly enough demand for the expansion of business enterprises that would be needed to get much of that oversupply put to work capitalizing expansion. But the people sitting on those vast piles of cash imagine that their wealth still deserves the return on investment it once enjoyed when unused wealth was not yet in oversupply. So they find fantasy “investments” to throw their money at that have little or nothing to do with the economy of producing goods and services, but succeed initially at providing good RoI to those who get in on the pyramid early.

Bitcoin is currently attracting a lot of this excess money that has no useful outlet. After the bitcoin bubble succeeds at destroying a lot of phony wealth when it bursts, some new fantasy investment will take its place. The only aspect of this worth worrying about is whether the destruction of however much wealth is tied up in the thing poses any risk to the economy of goods and services, as the 2008 bubble did. But if it’s only idiots who have excess wealth who lose out, that’s all to the good.

We should, of course, never have let them accumulate that excess of wealth, and failure to prevent that accumulation has its own negative consequences. But as long as there are fire breaks against contagion, let their bubbles go up like the Hindenburg.

3

johnb78 12.04.17 at 4:45 am

Isn’t the point of the EMH that it prices in probability? So if there’s [arbitrary numbers, not research-based] a 10% chance that BTC will be a runaway success and change the world and a 90% chance that it’ll be a total failure with a zero market value, then a market cap of $100bn would be reasonable *if* the world-changing currency end-state would have a market cap of $1trn. Which is about the current market cap of Apple.

I think the collapse scenario is overwhelmingly more likely, but I can’t see how you get from there to it refuting the EMH, any more than the fact that people invest in more conventional startup businesses even though the vast majority of them fail.

4

nastywoman 12.04.17 at 9:30 am

– as we have entered the century of the unlimited power of the Confidence Fairy and thusly ”the (international) money slosh why would Bitcoin collapse before prices for fake Leonardos?

As long as there are so many gamblers out there who believe that Bitcoin is one of the fastest dough making Casinos there will be a never ending raise in Bitcoin – and if you hang out as much with ”gamblers”’ -(as we love to do) – you will hear soon enough if you got to get the hell out of the burning Bitcoin Casino!
-(but that might have as little to do with some ”coherent” or ”rational” economical reasons as prices for fake Leonardos or F…face von Clownstick)

5

Tim Worstall 12.04.17 at 9:59 am

Johnb78 makes the point I would. While we’ve uncertainty about the end result then the existence of an option value hardly disproves the EMH. I agree on what the end result is likely to be but still.

6

Dave W. 12.04.17 at 10:36 am

Back when I studied the EMH in the early 80s (in a finance class for an outside minor), the textbook we used for that part of the class was Malkiel’s A Random Walk Down Wall Street. Before even discussing the EMH, Malkiel devotes two chapters to a discussion of historical bubbles. When he gets to the EMH, he emphasizes that you shouldn’t expect it to hold under bubble conditions (or by extension, in a financial panic). The first thing you need to do in an analysis where you are going to use some version of the EMH is make sure as best you can that you are not in a bubble.

So it’s not much of a refutation of the EMH to use data from a financial bubble to say it didn’t work. It’s been well understood for over thirty years that you shouldn’t expect it to work under those conditions, at least for anyone who has read Malkiel. I’d call it refuting a straw man argument, except that there may well be some formal descriptions of the EMH out there that omit the qualification. There are times when it is difficult to recognize a bubble without the benefit of hindsight, and it can be hard to reduce it to a formal condition. But the current Bitcoin market doesn’t seem to be a close case.

7

DrDick 12.04.17 at 3:35 pm

The one positive of the whole Bitcoin debacle is that it highlights the reality that the real value of all money is symbolic and not “real”.

8

John Quiggin 12.05.17 at 3:49 am

@6 I’m happy enough with the weak version of the EMH I mostly associated with Malkiel, saying that you can’t predict stock prices on the basis of past behavior. But I don’t think you can salvage strong versions of the EMH if you exclude bubbles, which may only be recognised in hindsight

@3 and @5 This line of defence was pretty close to non-refutability when it was applied to dotcom stocks back in 2000. But at least there was some real referent to the claim, namely that the Internet would make all kinds of businesses massively more productive. In the case of Bitcoin, the claim is that an asset can keep on appreciating for ever, if people believe in it strongly enough now. On that basis, I can’t see how anything could refute the EMH, not even the classic South Sea Bubble stock ‘an enterprise of great value, but nobody to know what it is’.

@7 On the contrary, commodity moneys have obvious real value. And while a government promise to accept fiat money as legal tender for debts such as tax obligations may be symbolic, it’s also every bit as real in its consequences, and in the power backing it up, as a piece of gold, arguably more so.

9

Collin Street 12.05.17 at 6:55 am

I mean, saving your thesis by saying it doesn’t apply in situations you don’t actually have a definition for…

…. does that even deserve a respose? Homeopaths are better than that.

10

Warren Terra 12.05.17 at 7:31 am

@#7 of course most money has real value. My American dollars are backed by the government’s vast property holdings – it can sell a few national monuments for scrap, apparently – and less flippantly by the government’s ability to levy taxes and custom duties and fees, extracting a portion of the value of holdings and of transactions involving obviously valuable, obviously real properties, goods, and services.

Bitcoin, on the other hand, is backed by your ability to prove that a pointless and wasteful mathematical exercise has occurred, and by the hope that there’s still a bigger fool willing to buy it off you. And by nothing else. It’s not an enduring source of value.

11

bianca steele 12.05.17 at 2:06 pm

I parked yesterday next to a car with Montana vanity plates reading “BITCOIN”.

12

DrDick 12.05.17 at 3:09 pm

John Quiggin @ 8 –
What is gold’s “real value”? You cannot eat it. It is not suitable for making most tools or structures. Indeed, it has very little practical value. Almost all of its value comes from the fact that people *believe* it has value. The same is true for a lot of other preciosities (gems, etc.). And before you say its value comes from the fact that it is rare, there are many other rare substances which have little or no value.

13

Layman 12.05.17 at 4:18 pm

@DrDick, I can see how you might convince me that Bitcoins are valuable in precisely the same way as is gold – because of a mass hallucination about the value – but I can’t see how that helps the argument for Bitcoins. People argue that the difference between Bitcoins and dollars is that dollars are more broadly accepted, but this isn’t the difference. The difference is that the US will allow me to pay my tax obligations in dollars but not in Bitcoins, and that as a practical matter the US is unlikely to ever accept Bitcoins as payment for tax obligations; and that the same is true for virtually every other sovereign currency in the world. Bitcoins are useful in just a few ways – as a means of paying for illegal activities, substances, goods, or services; as a means of avoiding tax and financial regulation; and as a means of speculation, at least until the big money has successfully fleeced the rubes and blown up the market.

14

Cirze 12.05.17 at 9:00 pm

So, the Winkelvei are not bitcoin billionaires?

15

Omega Centauri 12.05.17 at 9:34 pm

Actually Gold would have many uses, were it not so expensive. It is the best electrical contact substance around, for which reason it is sometimes used in electronics. It makes great spacehelmet reflectors -and I think is going to be used on the James Webb space tele-scope for that reason. Of course Platinum is a great catalyst, and it would be really great if there were in big enough supply to make it affordable for widespread industrial use. Until digital photography displaced chemical films, silver was essential for photography. At one point it was claimed silicon based photovoltaics wouldn’t be scalable to high volume, because Silver was needed to make transparent wiring within the cells -but I think alternatives are being used now. So actually many, but not all of the precious natural substances would have great utility if only they weren’t so rare/expensive.

16

Peter T 12.05.17 at 10:30 pm

Dr Dick

You are asking about the difference between use value and exchange value, a distinction which formal economics put aside a century ago as too hard, or possibly as unquantifiable. In any event, in the same basket as “green things with teeth” – don’t ask about it.

17

John Quiggin 12.05.17 at 10:32 pm

As you say, there are plenty of rare or hard-to-get substances that have little or no value (at least until relatively recently, most of the misnamed “rare earths”, for example). There’s an obvious difference between those substances on the one hand and gold, silver and gemstones on the other. If it doesn’t occur to you immediately, talk to someone less concerned than you with practical things like tools and structures, and more concerned with how things look. They will explain it to you.

If something inherently desirable is also used as a store of value that increases demand and therefore the price. But without inherent desirability, or a credible backer such as a state, an item is worthless.

18

Mike Furlan 12.05.17 at 11:11 pm

Bitcoin will be worthless because the technology that they are built on is flawed.

https://www.technologyreview.com/s/609408/quantum-computers-pose-imminent-threat-to-bitcoin-security/

19

Peter T 12.05.17 at 11:17 pm

JQ

Just what is “inherent” about desirability?

20

hix 12.05.17 at 11:25 pm

Just to be on the save side, i wont touch shiny metals as an investment either. Bitcoin will fall appart in all likelyhood during my lifetime. Gold probably not, but the value is still based on a shaky social construct.

21

DrDick 12.06.17 at 12:37 am

John Quiggin @ 13 –
Again, there are many attractive things that are not particularly valuable (aluminum, jasper, flourite, serpentine, etc.). Gold, silver, precious gemstones have no greater inherent value than they do. It is all in what those preciosities symbolize that confers their value. Copper, greenstone, micah, and conch shell had similar value among the Native peoples of the Southeastern US in the protohistoric period.

22

John Quiggin 12.06.17 at 12:44 am

@19 and @21 By “inherent” I just mean that people value them for their actual properties rather than because there is social convention that they are valuable.

To be crashingly, boringly obvious, people value gemstones and shiny metals because they are pretty and people like having and wearing pretty things. If they are highly malleable and ductile, like gold and silver, so that they can be worked into attractive jewellery, that makes them more valuable still. I find it hard to believe I need to spell this out, but if you are trolling me, you are doing a good job.

23

Collin Street 12.06.17 at 2:10 am

Strikes me you can’t argue the efficient market hypothesis to justify bitcoin values and at the same time assert that the preference for silver over aluminium for jewellry is irrational.

(“Not real” = socially constructed, is the framework. Because theory of mind)

24

Warren Terra 12.06.17 at 3:19 am

I like DrDick, but since for some reason this conversation has been derailed onto the value of gold and gemstones it’s worth going back to his original comment:

The one positive of the whole Bitcoin debacle is that it highlights the reality that the real value of all money is symbolic and not “real”.

I assumed “all money” mostly meant government-issued dollars and euros and the like, not gold and gemstones.

25

John Quiggin 12.06.17 at 6:55 am

@24 And, to restate my point, government-issued money is symbolic in precisely the way a letter containing government-issued tax assessment is symbolic, though with the opposite valence. The symbolic government money will satisfy the symbolic government tax assessment, as well as any other debts in the government’s jurisdiction.

What is symbolised here is not an arbitrary collective belief or social convention, but the government’s power to tax, ultimately backed up by its monopoly over legal violence.

By contrast, as observed above, Bitcoin symbolises the fact that a complex but valueless computation has been performed.

26

engels 12.06.17 at 7:52 am

I don’t think I’ve ever had a very optimistic view of modern capitalism but the sheer stupidity of this amazes even me

27

Collin Street 12.06.17 at 8:01 am

But further on that point: aluminium is vastly inferior to silver for purposes of personal adornment. Reason being:
+ it’s prone to very ugly-looking thick white corrosion that’s difficult to clean off and leaves the surface pitted and ugly; even when it’s clean, the oxide layer leaves a dull white sheen over everything. It’s just not an attractive metal; compare-and-contrast the japanese one-yen and ten-yen coins.
+ it’s got pretty poor mechanical properties. It’s soft, so it doesn’t keep a high polish, and it bends easilly; not only does it bend easilly, but it fatigues quickly, so fixing bent bits tends to break them off. It’s also prone to brittleness when cast. This means that delicate design is impossible; it also flows fairly poorly when casting, with the same effect.

I mean, even cheap toy jewellry for children is virtually never aluminium: it’s chromed plastic, or plated steel, or zinc die-castings. All of which are more expensive than simple aluminium: if your substitute cannot fool literal three-year-olds then… maybe it’s a grossly inadequate substitute? Maybe there’s something wrong with your thinking if you thought “aluminium is just as good for jewellry” was a sound conclusion?

[or… have a look at the collapse of amethyst price following the discovery of vast mines in brazil, or how the price of silver has been falling relative to gold for centuries with improvements to mining technology. Supply-and-demand is plainly working for personal adornment in other areas… so the notion that there’s something wrong or irrational about the price of precious metals and gems because it doesn’t comport with your understanding of the world is… a bit arrogant?]

28

nastywoman 12.06.17 at 12:39 pm

”aluminium is vastly inferior to silver for purposes of personal adornment.”

I still would go for fake Leonardos – I mean – all this other… ”stuff” can’t beat ”winnings” of a few thousand percents – and as ”sadly” nobody is interested in tulips anymore – fake Leonardos really make ”modern capitalism” -(a contraire to the view of Engels and Marx) – really look ”beautiful”!
-(as Von Clownstick would say)

29

DrDick 12.06.17 at 3:11 pm

Warren Terra @ 24 –
I was actually referring to any form of formal money, whether gold doubloons or paper dollars. The value of each is pretty much exactly what the government (or other issuer) says it is.

30

Warren Terra 12.06.17 at 3:55 pm

@#29
I’m not an economist, but I question whether the government’s ability to assert the value of their currency is as complete as you assert, even within their borders. If the government-issued money isn’t backed by something – typically the government’s ability to exert some control on and/or extract some taxes from a functioning economy – it’s eye-catching kleenex.

And it’s silly to conflate doubloons and paper money. Doubloons were a widely used international currency because of a general agreement at the time that “gold” meant “money”, as a commodity, in a way that had nothing to do with any respect for or interest in Spain.

31

Jim Buck 12.06.17 at 4:36 pm

32

nastywoman 12.06.17 at 5:20 pm

”The value of each is pretty much exactly what the government (or other issuer) says it is.”

Now that’s funny – as the Turkish government -(the issuer) currently says that the value of their Lira should be a lot higher than ”teh evil market” says – and that says it all.
(even I still think tulips are far – far undervalued compared to fake Leonardos)

33

Scott P. 12.06.17 at 6:38 pm

“quantum-computers-pose-imminent-threat-to-bitcoin-security/”

An imminent threat? I believe the greatest number of quantum bits that have ever been instantiated remains ‘one,’ and that for 1.75 seconds. And, as with most quantum effects, a system becomes more unstable the larger it grows, in exponential fashion.

I am doubtful we’ll get a quantum computer larger than 100 bits in the next century, let alone one capable of bitcoin manipulation.

34

Scott P. 12.06.17 at 6:48 pm

As for the debate on practical vs. ascribed value, I am reminded of the Roman expedition to the Baltic coast in search of amber during the reign of Nero; the Romans loaded up wagons of silver for bribes to Germanic warlords along the way and to use to trade for the amber. The Baltic peoples turned out to consider the Roman silver quite valueless; and in turn they could not understand why the Romans would come so far in search of a material that literally washed up on the shore. Though they would not take silver in exchange, they did want Roman iron and bronze, since those metals were hard to obtain in that part of Europe. The Roman soldiers participating ended up trading essentially every scrap on their person in exchange for the amber, knowing they’d be rich once they made it back to Rome.

35

John Quiggin 12.06.17 at 7:20 pm

@28 I’m hoping to say something about the value of Leonardos when I get a free moment.

36

Mike Furlan 12.06.17 at 10:07 pm

Scott P @33

https://www-03.ibm.com/press/us/en/pressrelease/52403.wss

I’m not sure I understand what IBM thinks that they did then.

Makes sense to be a skeptic. “Fusion power is always 30 years away. ” “Brazil is the country of the future and always will be.” “What can be more palpably absurd than the prospect held out of locomotives traveling twice as fast as stagecoaches?”

Well maybe not the last one.

But the idea that bitcoin will not be brute force hacked, even if it avoids falling to repeated human engineering attacks requires even more skepticism.

37

Warren Terra 12.07.17 at 1:35 am

@#36
So then the question is, which comes first: the collapse of the bitcoin because people eventually realize there’s no value in being able to prove a pointless mathematical exercise occurred, or the collapse of the bitcoin because people can no longer reliably prove a pointless mathematical exercise occurred?

38

John Quiggin 12.07.17 at 9:18 am

WT @37 FTW!

39

SusanC 12.07.17 at 10:16 am

I think that John’s argment works as an emprical falsification of classical economics + strong form of EMH, along the lines of:

– bitcoin not backed by use value of by givernments ability to force people to pay tax -> probability of it holding value long term is zero ;assuming classical economics)
– also assuming strong EMH -> current price of bitcoin should be zero
– but, empirically, it is not zero -> classical econimcs + strong EMH is empirically falsified.

Having done that, you’re not in a good position to make a predicitive claim about what will happen to bitcoin in future, based on a theory that you’ve just argued is empirically false and didn’t predict bitcoins current state.

Ok, ok, you want to reject EMH but keep the rest of classial economics. Needs more argument to pin the problem on EMH, I think.

(I think bitcoin won’t survive longterm, too, but I’m skeptial if the soundness of the argument).

40

Peter T 12.07.17 at 11:53 am

I would have thought it was obvious that if desirability is inherent in anything, it is in the desirer, not the object. There are lots of things that are shiny, rare and durable, but not desired. Lots of things that were once desired but are so no more. The desire for Bitcoin can be underpinned by social emulation, anticipation of making money, its suitability for use in underground transactions or whatever (certainly some mix of all of the above). What it is not underpinned by is any asset other than those used to purchase it. It is purely a medium of exchange.

One interesting aspect is that Bitcoin tries to eliminate the social power relations that underpin conventional currencies by replacing the issuer’s credit with anonymous and distributed “mining”. It is, in this, a very liberal project, if unlikely to be a successful one.

41

Zamfir 12.07.17 at 12:17 pm

@ Warren terra:

I don’t think that the pointless mathematical exercise is in itself a necessary requirement for the value (or non-value) of bitcoins.

The relevant part is the limit on the number of bitcoins. The mining part is basically a lottery to distribute the bitcoins. It’s a marketing gimmick – miners are advocates who feel ‘part of the system’, and they wouldn’t if all the coins had to be bought. There was also some trick where the mining helped to run the system, thus avoiding fees in the initial phase. Again, good marketing to kick-start the system.
But the system could just have started with a fixed number of bitcoins, which were distributed to charities or whatever.

Afaict, the ‘business case for bitcoins is this:
– the online world can use something similar to gold in the days of yore, a currency whose value depends on the widespread trust that it will stay in use as currency
– bitcoins can fullfil that function, mostly because they’re digital object that cannot be trivially multiplied
– bitcoins (and not some other similar system) will become the one widely-accepted and trusted currency
– that function will increase its value (above its natural value of zero), just as other objects (and gold) become more valuable when they are used as a currency
– therefore, buy bitcoins now for cheap and sell them when they are widely used as currency

I don’t believe it, but it has little to do with the mining calculations

42

SusanC 12.07.17 at 12:48 pm

Bitcoin’s desgn seems more oriented towards solving the “what if the government causes inflation by printing too much money” problem, rather than anonymity. If you want anonymity, it’s not ideal.

But, contra Jon, I think illegal transactions could potentially back a long term currency. Forget the reality of bitcoin for a moment, and consider the following hypothetical model:

– drugs have use value – people like taking them
– they are also illegal
– government money is sufficiently controlled/monitored that it can’t be directly used to buy drugs
– … but you can use government money to buy tokens, which, by a mechanism the government cant track, can then be exchanged for drugs

The customer hs an incentive: they get the drugs
The dealer has a motive: in exchange for drugs, they get tokens, which they then sell for government-issued miney to the next punter

Bitcoin isn’t quite that, but I could imagine something like that existing.

P.S. if the argument you want to make is that fiat money is ultimately backed by violence, and the state has a monopoly on violence, i note that Silk Road’s founder had a good try at breaking the governments monopoly on violence … its why he got arrested…

43

Z 12.07.17 at 12:55 pm

WT @37 FTW!

Don’t sell yourself short, John your

If it doesn’t occur to you immediately, talk to someone less concerned than you with practical things like tools and structures, and more concerned with how things look. They will explain it to you.

and

people value gemstones and shiny metals because they are pretty and people like having and wearing pretty things

were pretty good too.

44

Scott P. 12.07.17 at 5:38 pm

“I’m not sure I understand what IBM thinks that they did then.”

There they mention 16 qubits. Great, that’d be a big advance. Wake me when they get to 16 million.

45

Bill Murray 12.07.17 at 8:16 pm

Up until the Hall-Heroult Process was developed (patents by both Hall and Heroult applied for in 1886) along with newly cheap electricity, aluminum was more valuable than gold or silver. When the top piece of the Washington monument was put in place in 1884, the large aluminum casting was more expensive than silver. Frederick VII, King of Denmark had a ceremonial helmet made mostly of aluminum in 1859 and the aluminum cost more than gold. The aluminum statue of Anteros (usually said to be Eros) on the Shaftesbury Memorial Fountain in Piccadilly Circus has been said to be London’s most famous work of sculpture, still looks pretty good 124 years after it was put up.

46

Collin Street 12.08.17 at 9:22 am

Major computer-game distributor announces that they’ll cease accepting bitcoin as payment acct high transaction costs and volatility.

https://steamcommunity.com/games/593110/announcements/detail/1464096684955433613

I think we can stick a fork in it at this point.

47

John Quiggin 12.08.17 at 10:27 am

@46 Agreed. I just saw this and pitched a piece to The Guardian.

48

Salem 12.08.17 at 12:22 pm

But Steam stopped accepting Bitcoin because the price has gone up too much. It’s a bit ridiculous to predict that Bitcoin will be worthless because it’s too valuable right now.

You can’t buy Steam games with gold either.

49

JakeB 12.08.17 at 9:43 pm

@48–

No, they stopped accepting Bitcoin because the value is too volatile. Even if the negative effects on users are constrained to one direction.

Unrelatedly, I was wondering if the recent spike in prices was some kind of pump-and-dump that had something to do with the most recent hack and theft of bitcoins . . . .

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