The bitcoin network is run by miners, computers that maintain the shared transaction ledger called the blockchain. A new study estimates that this process consumes at least 2.6GW of power – almost as much electric power as Ireland consumes. This figure could rise to 7.7GW before the end of 2018 – accounting for almost half a percent of the world’s electricity consumption.
Bitcoin is – quite literally – destroying our environment. It’s erasing the meagre progress we’ve made on reducing our overal energy consumption, for a glorified Tulipmania.
Just as they did with Tulips and early 1990s comic books, the speculators will soon have extracted their fill, and move on to something else. They always do.
Consider looking at the big picture before you get stuck at the nanoscopic detail.
You mention reducing our “overall energy consumption”.
Imagine the foolish energy consumption that governments have been engaged in for too many decades regarding rampant militarism (amongst other things). Missiles, bombs, planes, tanks, guns, weapon-systems, nuclear material, etc. all contributing to foolish blowback-ridden foreign wars driven by stupid foreign policy stances that all have a foundation in the “funny money” system.
There’s an old saying ….
“Man makes money but God makes gold.”
Politicians do not like tangible-based (e.g. gold, silver) currencies since it restricts their options. Nixon got off the gold standard since the financial foolishness of USA government policies started to be problematic and a “hard-currency” like gold was an impediment.
The solution … a more accessable “funny-money printing press” brought to you by the Federal Reserve central bank (USA). Here, the government politicians make their dreams come true through printing money from thin air. More (easier to fund) wars, wasteful (less frugal) stances concerning government policy for citizen infrastructure since money “falls from trees” and no worry of nation’s future … just keep delaying the servicing (payback) of national debt to next government in office. Bailout of foolish entities that were not meant to be bailed out and for them to be bailed out they probably had wasteful/redundant practices indirectly linked to significant energy consumption.
Blah, blah, blah … you get my drift.
Enter Satoshi’s blockchain (implicitly decentralised) model, pre-2010.
There exist fake “blockchains” which are basically centralised database systems, meant as an attack on the decentralised ideas pushed by the Satoshi-related phenomenon.
Decentralised money (currency) transactions, e.g. Bitcoin or any of those “ALT” coins that respect the decentralised model, represents the first great use of this decentralised blockchain technology; a technology still in it’s infantcy and still evolving.
The BTC/ALT transactions are not funny-money based, their value is derived from the electricity used to power the computers to run those mathematical operations that lead to generation of the mined blocks (say, at least, solution to the “double spending” problem).
Due to this a BTC/ALT coin has inherent value and is debt-free.
Where’s the inherent value in fiat-based paper money ?
Paper money does not contain gold/silver/platinum/etc. dust.
Coins have much less silver (or none) in them as compared with the same coin denomination decades ago.
It is only the government’s word (or their monopoly on the nation’s currency) that still keeps the debt-ridden paper/fiat currency in action. History has shown that in general fiat currencies do not have a relatively long shelf-life; representing another wast of resources. It is conceivable that the debt-based nature of fiat currency would represent linkages to wasteful energy consumption on too many occasions. Easy-money can promote impatient/foolish decision-making leading to wasteful actions and most actions require energy.
Trump is now proposing a $716 billion defense budget for fiscal 2019 while USA has a 21 trillion USD national debt. This is crazy/wasteful stuff.
The BTC/ALT coin systems cannot be pumped up by newly generated coins from thin air, the coins have to be generated through computation. This takes time and is an enemy to those respective impatient economically foolish politicians.
On considering the above ramifications, do you still think it’s relatively costly to generate a BTC/ALT coin ?
Also, the BTC mining arena is not purely decentralised since a class of market-driven powerful hardware (ASICs) has taken up the mining slack to the exclusion of the general population. I do not think Satoshi’s decentralised philosophy imagined the mining to be segregated (say, less decentralised) amongst relatively fewer players. Other coins exist which recognise this “deficiency” and are based on mining algorithms that are ASIC-resistant, pro-CPU, switchable, etc. This would also have an effect on the broad energy calculation for mining.
In a decentralised-driven blockchain (etc. ?) utopian society where:
– there is no need for war
– humanity is free from the scourge of central banking
– humanity spends more time on creative endeavours, being more happy and able to realise on more occasions that there can be more clarity/substance in minimalism, etc.
– micro/nano-based transactions are very feasible (e.g. a people in Australia/etc. can send micro-transactions for funding/donation to a remote African startup/charity)
using a few percent of the world’s electricity potential would be worth it.
Who knows, if the potential for this utopian model is realised then we may actually spend our time on more important things like leveraging more energy from the Sun (deserts, roads, buildings, solar panels, etc.) to power blockchain-mining infrastructure (especially good for CPU-based mining) and spend less time on foolish/wasteful endeavours like self-driving car technology.