What the heck. I guess I'll jump in. After @Steve
introduced us to Bitcoin, I was mining Litecoin at one time in the past. I was using graphics cards and Litecoin was a better target than Bitcoin. In the end, I probably only recovered my overhead and probably didn't recover my capital. If I looked at the graphics cards as a subsidized cost, I might have made a bit more than the electricity cost. I would convert the fractions of Litecoin into Fractions of Bitcoin. I had been sending some of the little pieces to an exchange once in a while. And I would cash out once in a while. I didn't know it at the time, but people had started using different Bitcoin addresses for each transaction. I think I transferred about 1 Bitcoin to them, but I sent to an old address, which is essentially the same as sending into a black hole. I think they turned out to be disreputable and unreliable. I did have an email dialog with a technician there at one time and they wanted several hundred dollars to dig into the logs and recover my bitcoin. At the time I declined. So I lost ~1 Bitcoin. Like they say, hindsight is 20/20.
Here's some Bitcoin math that will bend your brain a bit. Some of you may know this. Some may not. How much processing power does it take to mine Bitcoin if there's only 1 miner. The answer is, if the miner is only producing the maximum coin quota per day, whatever that is, almost no power. The algorithm is trivial to solve if you're below the quota. Let's say @Steve
was the only miner back when (which he wasn't). He could easily mine 50 coins per day or whatever. Of course, they're probably worthless. Now, let's say I join in with the same mining hardware. The algorithm realizes we're now producing 100 coins per day, which isn't allowed. Therefore, the difficulty doubles, so the two of us are again making 50 coins per day total but that means we each only get 25 / day. Now, say 48 more people join with the same hardware. Now we're all still making 50 coins per day total but we're sharing them among 50 people, or 1 coin each. So, keying off the term horsepower, say each miner now has 1 minepower. (I made that up.) Each miner gets (their minepower) / (total minepower) * 50 coins = 1 minepower / 50 minepower * 50 coins. 1 / 50 * 50 = 1 coin each.
Now, what if half the miners want 2 coins per day instead, so they double their hardware. Does it work? NO. The equation for the miners with the big rigs is (2 minepower) / (75 minepower) * 50 coins = 1.333 coins each. The other miners with small rigs get (1 minepower) / (75 minepower) * 50 coins = .666 coins each. So, the people who doubled their rigs got some more money, but not double. The people with the little rigs lost 1/3 of their revenue. So, they say, dang it, we're losing revenue, so they double their rigs too. Now the equation for every miner becomes (2 minepower) / (100 minepower) * 50 coins = ONE COIN EACH. So, now everyone has doubled their rig, and their power consumption, and they're still getting the same revenue. You can imagine the trend with thousands of miners. This is a very hard game to win. The system will tend to gravitate to the point where each miner is just barely making a profit. If there are big profits, more miners jump in and profits go down for the others. If there are little profits, more miners jump out and the profit goes up for the others.
Having said all that, I know how to cut the power consumption of the Bitcoin network by a factor of 10,000. All you have to do is have every miner cut their minepower by a factor of 10,000. BUT, the relationship of each one's minepower to the total network minepower remains the same. THE EXACT SAME NUMBER OF COINS WOULD BE MINTED. This cutting could be done again and again until the lowest common denominator miner is running on a Roku stick or something like it, using 10 watts of power. Again, the EXACT same number of coins would be minted. You make money by the RATIO of your minepower to the minepower of the total network. Is this possible? Probably not. Since people are greedy, there's always going to be the temptation to keep adding hardware to get more of the totally finite Bitcoin pie. But, it's fascinating to think about. Hope you found this interesting.
May your bits be stable and your interfaces be fast.