Do you see the 14 nanometre limit of transistors as a good thing for decentralization? There's been an enormous increase in the hashing capacity of the Bitcoin network and now it's slammed into Moore's Wall. It's a very good thing because it extends the shelf-life of mining equipment from 2-3 months to almost 2 years.
Until now, the determinant of success in mining was how many kilometres you were from the semiconductor fabrication lab and how fast you could hook it up to 50 megawatts of electricity. With a 2-year shelf-life, you can re-decentralize mining. Renewable energy with cycles of demand, using extra megawatt hours with low consumption that would be lost anyway to mine bitcoin. Bitcoin is a battery on a virtual blockchain.
Transcript
[AUDIENCE] Excellent analogy. Do you see the 14 nanometer transistor limit as being... a good or bad thing for decentralization? [ANDREAS] I think it is a really good thing.
To repeat the question, do I see the 14 nanometer transistor limit- We have seen an enormous increase in the hashing capacity of Bitcoin's proof-of-work network. It has been catching up to Moore's Law, and now it has slammed into what appears to be Moore's Wall. This is a very good thing for decentralization. It extends the shelf life of mining equipment...
from two to three months, to almost two years, which levels the playing field across all participants. Until now, the determinant of success in mining was, how many kilometers were you from the fabrication lab? How fast could you get that equipment out of the lab, onto a truck or shipping boat, and into your warehouse... and hook it up to 50 megawatts of electricity?
That means most miners were within about five hundred kilometers of the semiconductor fabrication lab. If you tried to put it on a ship and move across the water, it would leave your shores as a fantastic equipment, [but by the time] it arrives in California three months later, it is scrap metal. If you have a two-year shelf life, you can now re-decentralize mining and take advantage... of differences in electricity cost.
One of the really interesting opportunities is using renewable energy with cycles of demand in it. For example, if you have energy production from solar or wind. Production from hydro is [more] fixed, where you have [a certain amount of]... megawatt hours will come out of your pipe all the time.
Consumption in the distribution network changes over the day. What should you do with the excess capacity? One opportunity to think about is using that excess capacity to mine bitcoin, when it is not being consumed [elsewhere]. It is energy you would be generating anyway, that would be completely lost, but now you convert it into bitcoin.
Effectively, the Bitcoin blockchain is a virtual battery.