Bitcoin: The opportunity costs of mining for money

Everything we do and every choice we make has an opportunity cost. In a world of scarce time and resources each choice necessarily means rejecting many other possible opportunities. One of the best illustrations of this concept was made by President Eisenhower in a 1953 speech. Eisenhower criticized the use of scarce resources for military purposes because of the opportunity cost:

The cost of one modern heavy bomber is this: A modern brick school in more than 30 cities. It is two electric power plants, each serving a town of 60,000 population. It is two fine, fully equipped hospitals. It is some fifty miles of concrete pavement. We pay for a single fighter with a half-million bushels of wheat. We pay for a single destroyer with new homes that could have housed more than 8,000 people. [The Chance For Peace]

These kinds of choices are just as difficult as they were for Eisenhower in 1953. How much time, resources, and effort should be dedicated to military activities? It’s still a contentious argument, and opinions greatly differ.


2 thoughts on “Bitcoin: The opportunity costs of mining for money

  1. Isn’t that what we have already:

    – issued at near-zero cost by the Federal Reserve,

    – available to anyone in exchange for a regular dollar,

    – stored on a computer or smartphone in a digital wallet,
    Credit cards, check

    – and, like Bitcoin, capable of secure peer-to-peer transfers and transactions around the world.
    Well, here we may have a problem. BTC peer-to-peer nature requires the transaction ledger to be public. Which means, that FED, BOE, DOD, MI6, members of Parlament and Congresspeople, and generally each and every member of the Government will have all of their transactions completely OPEN TO EVERYONE. John, I am sure they will love the idea!

    Joking aside, John, you can’t be serious, suggesting that ***effortless*** money creation will somehow work. Hasn’t it been tried before many times already?

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