Apparently, the entire world has become convinced that digital currencies in general (and Bitcoin in particular), NFTs, and all other blockchain technologies, are going to burn down the Amazon, set the entire planet on fire, consume more energy than the Big Bang produced, and reduce everything we hold dear into cinders.
That’s the gist, we think.
It’s malarkey. We were promised no more malarkey.
So here’s why:
Energy is not finite
DISCLAIMER: Yes, blockchain tech uses energy. Plenty of it. The way it works is exactly by transforming energy, nature’s most essential commodity, into money.
Good thing there’s plenty of it.
Once you know the first thing about physics, it becomes quite annoying to listen to people talking about energy like it’s a finite thing. Energy is what we use to do… everything. Our very mass is so closely related to energy that one can’t exist without the other. If something works, then it uses energy. Work is energy.
Every great advancement in the history of mankind has implicated more work, and, as such, more energy. It’s the nature of progress. If you are working, then you expend energy, which means you must eat. When you teach a horse or a dog to work for you, then they must eat. Once you invent a big ol’ machine to do even more work for you, then it must also eat.
We have more than DOUBLED our energy usage since the 70s. Bitcoin was invented in 2008.
It’s nonsensical to blame blockchain for what is essentially a technological issue. Technology eats energy. It’s how it works. Yet, no one wants to get rid of cars, computers, iPhones, or 4K HD TVs. Even though all of those things consume more power than whatever came before.
“But what about electric cars?” you ask.
What matters is how you produce the energy
Is it preferable to have a car that consumes electricity than a car that consumes fossil fuels? Yes. It is much better. For climate change is indeed real, and measures must be undertaken to reduce our dependence on fossil fuels.
That’s exactly why a monetary system that runs on electricity is what we want to have. Because that will provide people with massive incentives to modernize their grids and produce electricity in the least expensive and most renewable way possible.
78% of Bitcoin’s electricity usage is from renewables. People are using electricity to make money. Do you think they’re going to want to spend money to do it? They will want it for free. That means energy that would be wasted otherwise. Wind, solar, geothermal. Energy is all around us, and digital currencies are helping us create the means to harness it faster and more efficiently.
The banks are worse (way worse)
Remember when we said technology usually consumes more power than what came before?
And how that’s fine?
Well, in this case, that’s not even what’s happening.
Just in major infrastructure (i.e. ATMs, branches costs and server costs), banks consume four times as much power as blockchain.
So here’s our suggestion to people who keep harping about the energy consumption of the blockchain:
Why don’t you go read 100-year old arguments about how the gold standard did the exact same thing, and then get back to us.
We’ll be right here, pushing for greener energy, not less of it.