Home brewing and Cryptocurrency

by @edent | , , | 3 comments | 400 words | Read ~133 times.

This is a thought experiment inspired by the sort of rambling and speculative conversations my wife and I have been having in lockdown.

Most countries in the world place legal limits on alcohol production at home. There are, usually, several good reasons for this:

  • Improperly brewed alcohol can cause severe health problems - including death.
  • Poorly set up stills can - and do - explode.
  • Unlicensed sellers of alcohol generally don't pay tax.

I'm sure you can think of a few more reasons to add to the list.

In the UK - where I live - brewing wine and beer for personal consumption only is allowed. Distilling alcohol requires a licence. Again, most jurisdictions have similar attitudes to home brewing.

Here's my big question - should CryptoMining be treated in the same way as the manufacture of alcohol?

(I'm in no position to enact such a global law. This is a thought experiment.)

The current state of proof-of-work mining is:

  • Environmentally destructive.
  • Opens users up to fraud.
  • Reduces tax income to the state.

I'm sure you can think of a few more reasons to add to the list.

Could / Should / Would countries ban domestic cryptocurrency generation?

We all thought the coming war on general-purpose computing was going to be driven by DRM. But what if it is driven by Central Banks eager to retain control of currencies?

Even if such a law was enacted - could it be policed? Given that the computer equipment needed to mine currency is functionally identical to regular computer equipment, how do you stop people buying it?

Recently, the GPU manufacturer NVidia restricted the hashing power of its domestic graphics cards to stop them being used by miners. (Of course, this limit was quickly bypassed.)

Would we end up in a situation where you may be allowed to mine a trivial amount of currency for "personal consumption" but would be forbidden from generating too much? How could that be measured, let alone enforced?

Again, to be clear, I'm not in favour of such a restriction and have no ability to write laws about it. But I think such a restriction is likely to be proposed before too long.

An effective way to stop this happening would be to move away from speculative mining which requires large amounts of energy. If crypto can't get efficient - it'll find itself on the wrong side of history.

3 thoughts on “Home brewing and Cryptocurrency

  1. Neil Brown says:

    "I'm arresting you for the crime of doing the wrong sort of maths. You know, illegal maths.

    You do not have to say anything, because you've probably written it up as some kind of 'white paper' already."

  2. this is fascinating to think about. Home distilling is of course almost impossible to police as well - unless the output is sold in significant quantities or there's an accident...

  3. Incidentally, the health & safety considerations of home brewing/distilling are hugely over-blown. They just conveniently align with the tax revenue.

    Home distilling is legal in New Zealand, lest you needed another excuse to be jealous.

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