Elon Musk is no longer supporting the Bitcoin cause. Apparently, it’s not green enough. According to him, mining Bitcoin uses up too much electricity and that’s bad for the planet.
But that’s a fallacy.
Surely producing Teslas, sending rockets to Mars, and tweeting nonsense online non-stop also have a high carbon footprint. But that’s not the point.
Every human activity needs energy, from the food you eat to the car you drive to the lines you are reading on your device right now. Everything.
But some things are better than others. Driving an electric car is better than driving a diesel. Producing solar energy is better than burning carbon fuels. Recycling is better than buying new, and crypto is better than Fiat money.
Efficiency vs Wastage
Think of the old financial system we’ve been using for decades. Money printing, distribution, banking, the stock market, and all the government apparatus to support this.
It’s all very wasteful and inefficient. Keeping money in circulation is an expensive operation with a high environmental cost. But all this it’s necessary in order to implement, maintain and secure a monetary system that works. We have no choice but to put up with the cons in order to benefit from the pros.
Now we have another choice. A decentralized system that runs on a network of nodes provides all the benefits of money at a much lower cost. It’s called Bitcoin.
The energy used to maintain the BTC’s lightning network is a fraction needed to sustain banking, the Fiat system, or Gold mining.
Any system needs to run on energy, the key is to choose the most efficient and the less polluting option. By looking at the graph, the choice is clear.
Bitcoin vs Dogecoin
Elon reckons Bitcoin wastes too much energy and he’s promoting Dogecoin instead. I can find many flaws in his argument.
Bitcoin is a proven technology, with a huge stable network of nodes, properly maintained, run by the community and the blockchain protocol. This ensures stability, efficiency, and transparency.
Dogecoin is a just meme.
Designing a cryptocurrency is a highly complex operation, code needs to be maintained, miners need to be rewarded fairly, and the algorithm must be secured. Just making a logo with a cute dog face won’t cut it.
If we are going to make something better than the current financial system, we need solid technology, not a fad.
Maybe dogecoin uses less energy per transaction than Bitcoin, but can it sustain all the complexities of a monetary network? Can it scale? Is it secured?
No, but it’s so cute!
The danger of supporting an untested model is that it could collapse when exposed to stress. And that would be truly wasteful.
Would you go to the moon in a fancy rocket, with sketchy technology and a cute dog face painted on it or would you rather use a proper spaceship built by NASA?
Whatever works is always more efficient than anything that doesn’t work. So, if we want to save the planet, we better support useful technologies, not shitcoins.
There are many cryptocurrencies out there with sound technology, a proven system that works, and an efficient mechanism for securing transactions. Dogecoin is just not one of them.
Ethereum, Cardano, Polkadot, Solana, and many more are sound projects with proper fundamentals. Most of them use less energy per transaction than BTC but that also comes at a price: Security.
Proof of Work
In order to secure the protocol, BTC uses a mechanism called Proof of Work — a system that ensures the reliability of every transaction by solving complex mathematical puzzles, and it’s based on the immutability of the public ledger.
Proof of Work has been criticized in the past for using too much electricity. Other cryptos use more energy-efficient systems like Proof of Stake.
The question here is, are they compromising security in order to save a few bucks? Would you put your children in a car with no airbags just because it uses less fuel?
Efficiency is important but effectiveness is more important. When something has to get done, cutting corners is never the best solution. Make sure things work properly first, then look for inefficiencies…in that order. Safety first.
We need energy for everything and lots of it. The key here is not how much we save but how clean is the one being used.
Solar energy is a good example. If all the energy produced came from solar, we wouldn’t need to care about being efficient. We could be wasteful with it and still reduce our carbon footprint to zero.
The sun itself is an extremely inefficient star that has been burning hydrogen for millions of years. Should we try to make it more efficient? Shall we organize a committee of experts to reduce its carbon emissions? Shall we send Elon there to turn it down a notch?
It makes sense to reduce energy usage when it comes from burning fossil fuels, but when it comes from renewable sources, it becomes much less important. The earth is energy abundant, there are millions of Tera-watts wasted every day from solar, wind, and hydro-power. Every river, every sunny day, every wind breeze is just an opportunity to collect energy and put it to better use.
But there is no need to obsess with it, no point in being hyper-efficient. There is plenty of it and there will be even more tomorrow. If we could manage to catch just 1% of the energy available on the planet, that’ll be enough for all our needs. The other 99% will get wasted inevitably but that’s ok.
Now, Bitcoin might not be extremely efficient per transaction but it is very effective on the whole. The Bitcoin operation runs on 75% renewable energy so it’s effectively promoting the transition to a greener future. Solar and hydro are much cheaper than fossil fuels and low costs are crucial to run the blockchain algorithm. It’s a perfect symbiosis.
Would you rather use a cryptocurrency that promotes the use of green energy or buy a cute dog shitcoin that saves 0.1% of electricity?
Bitcoin as a Battery
The problem with energy is that it can’t be stored. Too much energy is produced at off-peak demand and most of it is wasted because there isn’t an efficient and cost-effective way to store it. Batteries are still too expensive.
But that was until now…
Bitcoin is actually a giant battery, one that stores value in a secure network by using non-incremental energy that would be wasted otherwise. This can be used to pay for the same electricity when needed.
For example, it would be feasible to produce your own solar energy with a few solar panels in your roof and then store it in the form of monetary energy by mining Bitcoin. Later, when you need electricity and the sun’s not shining, you could buy it back from the utility company using those very Bitcoins.
This is a very elegant solution that makes a lot of sense from an environmental, economic, and engineering point of view. The world is bubbling with energy, literally — geothermal, waves, sun, wind, hydro — all these are getting wasted mainly because we don’t know how to store it.
But now we do.
Bitcoin is the biggest battery ever invented, one that can provide many underdeveloped countries with a solution for their energy and financial needs. Why bother searching for pennies under the sofa when it’s raining $100 bills? It makes no sense.
Elon Musk is wrong this time. Bitcoin is monetary energy, the hardest form of money and our biggest chance to build a better world.
Why waste time on shitcoins or trying to save 1% of electricity when we have the most secure, the most effective, and the most reliable store of value ever.
Mr. Musk, you can keep your Teslas and your dogecoins, I will buy an electric car that promotes the use of clean energy and I will pay with a currency that does the same.
I’m done with your contradictions, your erratic behavior, and your need for attention. You are wrong this time and you know it, we don’t know why you are pushing this agenda but eventually, we’ll find out. In the meantime, you should clean your act and become more transparent, more reliable, and less chaotic. You should learn from Bitcoin.
I was considering the possibility of buying a Tesla in the future, but no more. I rather buy a proper asset that is not covered in dog shit. Also, don’t count on me to go to Mars on a dodgy rocket with a cute pet face painted on it. I rather use sound technology.
Good luck with your meme.