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It was probably Satoshis biggest failing. If you read his white paper and early forum posts, the sole intention of mining was to engage a community of normal home PC users to take part in securing Bitcoin and therefore have a vested interest in contributing to the project.
Unfortunately, he didn't take into account the scale of the desire that humans have to make profit on an industrial scale and he also disregarded the warnings from Moore's Law.
The progression from CPU mining to GPU was bad enough (100w to 450w of power per miner) but it's a puzzle why nobody involved in the theoretical side of planning bitcoin considered that fgpa and asics would be developed.
Bitcoin itself uses a difficulty adjustment mechanism which means that at periodic intervals the difficulty of mining is adjusted to ensure that coins are mined at a roughly smooth emission rate. I.e if you have a fucking huge mining farm you get a few weeks where you mine a lot of coins and then the network corrects itself to slow down production. This basically means that the mining arms race isn't about mining coins faster, it's about competing with other miners for market share.
Perversely, instead of nurturing distributed hobbyist security for the network, PoW has lead to a situation where 2/3rds of the bitcoin mining hash rate is located within a few miles of the three gorges dam. Most articles about the environmental impact of Bitcoin seem to skip the fact that's he vast majority of power used is from renewable sources, partly due to state subsidy of green power costs in China. I'm not saying this is a huge improvement, indeed there is one farm in Georgia that is hooked to an oil fired power station and reportedly emits hundreds of kilos of Co2 for each bitcoin miner, but the situation isn't quite as desperate as many journalists report.
Consensus mechanisms are tricky. It's the kind of subject that has entertained cryptographers and mathematicians for centuries. See Byzantine General problem.
PoW was ground breaking, PoS is a huge step forward for the projects that use it. IBM have been doing some really cool work with something called Proof of Time Elapsed which is energy efficient and could be huge.
My project is working in a concept we refer to as "the third way" or "Proof of Consensus". The goal is to secure a blockchain in a cryptographically secure and therefore extremely low power consumption way. Too early to get excited though, we're only just working through the proof of concepts now. We think it is awesome, but there is a long way to go before we prove whether it is or not.
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Stonehedge
@The_Seldom_Killer
If that were achieved, how much would that reduce the overall average per unit energy cost of any given cryptocurrency?
This is one of those things that I find fascinating and horrifying in equal measure. Unlike the majority of currency formulation, where resource capital could be highly variable, cryptocurrency was far more predictable. At the advent of Bitcoin, did anybody actually bother to look into the projected environmental impact?