November 5th, 2014


There is an economics dissertation in here, somewhere

I call your attention to this article in TechCrunch a few days ago, about a company that has built a cloud-hosted supercomputer system for mining Bitcoins.

Ponder that for a second. This is a company that is more or less literally renting machines that print money. My head breaks a little when I try to wrap it around the weird economic recursion in that. And I'm trying to find a reason why it makes sense to rent out such a system, instead of just running it on your own account. I have a suspicion that the owners of the system are essentially using it to hedge currency fluctuations, and that most users of this cloud are taking on more risks than they properly understand...