Consensus in both of them is based on unforgeable costliness, to make it economically unviable to create alternative histories. In PoW, the costliness is based on production and consumption of energy. In PoST, the costliness is based on production and consumption of hard drives. Hard drive production needs both energy and natural resources.
In both systems, total cost of mining approaches the block reward. For example, if block rewards are $10 million a day, then $10 million worth of energy is used in PoW. PoST burns through $10 million worth of hard drives.
The cost of PoST is based on scarcity in hard drives, which incentivizes production of hard drives. The cost of PoW is based on scarcity in energy, which incentivizes production of cheap and clean energy.
If PoW's costliness is based on production and consumption of energy, it requires a certain amount of energy and natural resources to produce the hardware required to consume the energy, correct?
I'm failing to follow how PoW is fundamentally different than PoST in terms of hardware (and the resources to produce it) necessary to validate blocks.
It seems that the point of PoST is that we get a similar potential of decentralization that we get with PoW with significantly less energy usage.
I somewhat understand the argument of PoW incentivizing production of cheap and clean energy and I hope this is realized ... specifically clean energy, specifically advanced nuclear as its utilization isn't geographically restricted.
Yes, it requires production of mining hardware, but just for adding new hashing capacity to the network. Major part of the mining cost comes from energy, and I believe that in the long run even more so. Energy efficiency of mining hardware has pretty much plateaued, and modern hardware should be good for 10 years of mining, which means that less hardware has to be replaced.
The competition has shifted into finding cheaper energy sources, rather than developing more energy efficient ASICs. There's a clear trend in this direction.
Clean energy sources are the cheapest [0], and they get cheaper with every new investment and innovation. The competition in Bitcoin mining is global, which means that it becomes unprofitable for everyone to use fossil fuels when profit margins fall enough. This isn't true yet, and it's profitable to use fossil fuels in certain regions.
Usually the cheapest sources are also far away from people, because any local demand will increase energy price. However, when renewables near people have overcapacity, Bitcoin miners can serve as a buyer of last resort. This way, investments in renewables become more profitable.
We can definitely agree that crypto's demand for electricity basically doesn't care about location. So it puts a floor of demand for electricity generation in remote places. (Also in more accessible places. But there it's relatively less important.)
Electricity is both fungible to an extent, but also not as globally traded as eg wheat or oil.
You are right that on the margin Bitcoin makes generation of renewable electricity more profitable. But it also makes all other electricity generation more profitable, on the margin.
