One of the first thoughts anyone looking at Bitcoin will have it the amount of energy used by ‘miners’ to maintain the blockchain.
Apparently to some Bitcoin and blockchain will boil the seas dry with its energy consumption.
Bitcoiners would say this is FUD. FUD is the modern equivalent of BS or just straight lies and is often used as an out of hand rebuttal of argument. FUD stands for Fear, Uncertainty and Doubt and used to be an old strategy in marketing to confuse you competitors and keep them from buying your product in a corporate environment generally ruled by a culture of ‘CYA’ (cover your rear) and fear.
Bitcoin using to much energy is thus pure FUD as it originates in the sectors who will lose more or be disrupted most by the Blockchain, the latest being the BIS a core piece of the global banking infrastructure.
Lets have a quick look at banking’s footprint. According to the world bank there are 12.5 bank branches per hundred thousand people in the world. That doesn’t include their massive energy munching head offices and titanic server farms which I’m sure would embarrass even the mightiest bitcoin miner by its scale.
So the world population is 7600 million, so there are, at least according to the World Bank, and they should know, just shy of 1m bank branches. The have 3 million ATMs roughly the same amount of machine as there a bitcoin mining ASIC. As such Bitcoin uses the same amount of energy as the banking sectors ATMs, leaving that business to boil the oceans with 1m branches and the resource drain of 60m people and their associated overhead. (Yes a bank like HSBC does employ 228,000 and have 3900 offices)
There will of course be changes to blockchain technology to scale it and make it more energy efficient, but energy consumption is only an issue to those that haven’t looked into it.
Bitcoin and other cryptocurrencies also potentially replaces gold as an international asset of last resort and it is said the energy expended raping the earth for the precious gold monetary relic is 5 times that expended on Bitcoin. Even if it was a 1:1 the replacement of Gold by Bitcoin would surely be a environmental good.
Then you just have to multiply out the ponderous, soul destroying processes that require never-ending paper chases to see the Crypto would be a giant boon to the environment the leviathans of energy goggle bureaucracy fall to the greater efficiency of Crypto.
I don’t mean to go all Marxist on my gentle reader but in the end it all comes back to energy efficiency because everything backs out to energy costs in the end. If Crypto and blockchain is not more energy efficient it simply wont be economically feasible to use it as Banks and their offices, ATMs and tens of millions of workers will simply cost less than the blockchain alternative.
Can you see that? No, nor can anyone.
There is however a pinch point.
This pin point is energy.
There simply is not enough of it being laid down for the future and I mean electricity.
Is it really smart to hold every photo I ever took in the cloud? Is it really a good idea for Google, Microsoft and Amazon to be hoovering everything I say and do into huge massive server clouds powered by Hydro power. Does anyone complain about this boiling the seas?
Well consider this. Google grosses 110 billion in sales, it makes 12 billion, it has 12,000 billion yearly searches, call it 1c a search. (That in its own right is rather fascinating) When energy makes up a huge amount of that cost, its 8% margins start to look might slim and the sudden bans on Crypto advertising amongst the likes of Facebook, Twitter and Goggle start to seem more than coincidental as the crypto-miners start to gravitate to the cheap energy that keeps these companies in business of datahoarding.
Yet this is only the tip of the iceberg of energy shortage just over the brow.
If the dream of electric cars and trucks is to be realised and Europe is actually stating it want petrol and diesel gone by 2030, the world needs 50% more power stations.
It is worth stating again. If the US andEurope are going to dumpthe internal combustion engine it will need 50% more electricity infrastructure and install it in 20 years.
They better get cracking and we better get buying those stock.
Meanwhile expect lots of FUD around anything that draw electricity and threatens to drive electricity prices high. It is coming and lots of the darlings of silicon who claim environmental credibility while sucking power out of the system with a might force will feel the pinch as their energy hungry ways catch up with them.
Bitcoin mining, data mining, its all the same.