Be ready for the next major attack against Bitcoin, it's coming...
There is one area that is likely to keep coming up with the new administration in the United States.
The current administration seems to be more clear regarding bitcoin and crypto regulations thus far, or at least they say they intend to be, but there is still something that's a bit concerning...
And that has to do with their affinity to combat climate change (or global warming).
There is no denying that bitcoin is energy intensive.
It requires a tremendous amount of computational resources in order to produce new coins and keep the bitcoin network running and secure.
Ironically the more secure the network becomes, and higher the hashrate climbs, the larger its carbon footprint likely becomes.
This is likely to put a major bullseye on the bitcoin by the current administration here in the United States.
However, getting beyond that scare mongering headlines, the truth isn't nearly as bad as it sounds...
Our good friends at ArkInvest, and yes they are our good friends as they recently put out a $400k price target on bitcoin if 10% of S&P cash flows into bitcoin (https://hive.blog/hive-167922/@jrcornel/if-10-of-the-cash-on-corporate-balance-sheets-moves-to-bitcoin-the-price-would-increase-by-more-than-usd400k), put out a very interesting and illuminating piece of research...
Specifically, it's a graph of the energy expenditure as it relates to bitcoin mining, gold mining, and the legacy banking system...
Here's their graph:
(Source: ~~~ embed:1360655486161453060/photo/1) twitter metadata:Y29pbmJ1cmVhdXx8aHR0cHM6Ly90d2l0dGVyLmNvbS9jb2luYnVyZWF1L3N0YXR1cy8xMzYwNjU1NDg2MTYxNDUzMDYwL3Bob3RvLzEpfA== ~~~
A great big nothing burger...
While there's no denying that bitcoin uses a lot of electricity, when you compare it with the industries it is attempting to replace, it suddenly doesn't look all that concerning.
As you can say from the graph above, it's quite clear that the energy expenditure of bitcoin mining is a drop in the bucket compared with gold mining and the banking system.
No one really likes to talk about that though.
In fact, one could make the argument that if bitcoin were to fully replace gold as a store of value and take a big chunk of the current banking industry, the amount of total energy expenditure would be significantly less than it is today.
Not only would bitcoin not add to the current energy expenditures, but might actually end up being a net reduction in total energy expenditure.
But wait, there's more...
One of the research analysts at Ark had put out a great Twitter thread talking about all the other reasons this is a big nothing burger, which can be see here:
If you don't have time to scroll through the thread, or simply don't feel like leaving this post, here's a couple of the bullet points:
(Source: ~~~ embed:1360343401627979778/photo/1) twitter metadata:eWFzc2luZUFSS3x8aHR0cHM6Ly90d2l0dGVyLmNvbS95YXNzaW5lQVJLL3N0YXR1cy8xMzYwMzQzNDAxNjI3OTc5Nzc4L3Bob3RvLzEpfA== ~~~
We are very likely going to experience a ton of push-back in the media and with the current administration on this topic over the coming years.
We need to be prepared to defend the truth and make sure reality doesn't get overrun by rhetoric and the popular narrative of the time...
Stay informed my friends.
-Doc
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True.. but fighting the global climate narrative is just as daunting. Not to mention I cannot wear BTC. Maybe we should be able too.
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The people propagating this lie know exactly what they are doing. They know that Bitcoin doesn't waste energy. This is simply propaganda. There are so many things to talk about on this front:
Bitcoin is Under Attack by the Establishment: But Leads the Charge in Green Energy!
Bitcoin is a threat to not only central banking, but also Big Oil, as it actually funds renewable energy. The ability to take "physical" energy anywhere on the planet and turn that into digital money is a revelation. Bitcoin's ability to turn power into currency is a huge feature... in fact that is the crux of solving the Byzantine Generals problem... it's literally a miracle... and these vipers are out there saying it's the Devil.
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Yep exactly. Well put! We need to make sure enough people know and understand this so that when this become the narrative being pushed by the powers that be there is a strong rebuttal.
It is true that naration of bitcoin mining consume too much energy is exaggerated. From the data above that energy mining of bitcoin is less than banking energy. Let 's see how much energy to open an bank office. If every bank has 1000 offices and thousands atm centers. How much energy they consume.
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When we consider fundamentally, anything cannot be created from thin air. Thus, more or less, Bitcoin or any digital value is supposed to be based on power, energy, time or any other thing so that it represents a value.
If something requires $1 to be created in any way, the intrinsic value is created along with the created asset...
The recent discussions are beyond being rationale as both speakers and listeners are all aware of these facts. I have never taken serious such claims and until any policy maker takes a step, it's a waste of time to deal with such statements...
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You dealt with it well though.
Wonder how much of that energy Banking system used are for storing the values of all currencies and how much are unnecessary wastes.
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Likely a lot
FUD. There's always someone out there trying to rain on everyone else's parade. The good news, however, is that we need these people so the ship can keep rising. The markets climb a wall of worry. As long as there is a healthy contingent of doubters spouting off about bubbles and energy consumption and gov't control etc., then the markets will keep climbing. It's when EVERYONE says its going to the moon that I get worried. Nice article.
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Wow, I had no idea banks consume so much energy! Great comparison the guys at Ark put together.
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Hmmm... banks consume as much energy!
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This is great! I hear this often and I will reference this article, thank you!
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Bitcoin mining destroy the world?
"What we gonna do tonight Brain?"...
Whoever is against mining needs to make better excuses to stop this work, haha!
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Thank you for this!
I just wrote a post the other day about an article I read that was going heavy on Elon Musk saying that he claims he wants a world that runs on cleaner energy but at the same time his company now carries a lot of "bitcoin pollution".
I knew it was yet another exaggeration of the mainstream media but I had no idea how the energy expenditure of bitcoin mining compared to the banking system. The data you presented really puts it in perspective.
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Wrong It will because bitcoin will take over all other fiat currency ;)
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More info why you see this.
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quite sure amazon's aws eats more energy than bitcoin mining too. thanks for this post, people really have no idea
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In that case the holders of bitcoin
need to lobby this news.
I know Saylor man will jump
and make this big if needed.
I like your but wait, there is more line
Keep us informed.
!BEER
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BEER.Thank you for sharing this. I usually didn't really know how to reply if people brought up Bitcoin's energy consumption ( when I wanted to talk crypto with them ), it often killed the chat, even though I reckoned banks use loads more energy ( didn't event think of gold mining ). Nice to have this graph now, to prove the point. Downloaded it and will bookmark it for future reference.
Thanks again! :<)
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Wow this is awesome. I was one of those people that heard about this and it scared me because as cool as crypto it was difficult to support something that was labeled as a huge waste of energy.
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When there is a threat "defend yourself and attack", if we start to analyze the real numbers I think that nothing else in energy consumption, gold production far exceeds Bitcoin, to that we can add the environmental impact and other costs that do not I will mention generated by gold production. I think it is very possible that Bitcoin will become a world reserve in the future, where it is seen is more convenient.
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This is such a lame excuse to not adopt Bitcoin. The media is coming up with any possible reason to avoid change.
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This is a well-documented post I myself kind of accepted that mining crypto seems to use a lot of electricity but the comparisons made here against gold mining and banking systems make a good point.
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