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Let’s be clear about what the real problem is here. The problem is a lack of consensus on our societal priorities.
I got into a debate on Twitter recently about fossil fuels being used by SpaceX rockets, but that was deemed OK on the basis that SpaceX flights produce less CO2 than Bitcoin.
That’s how we know what the real debate is. It’s OK to use fossil fuels but the majority needs to be in consensus about it.
So let’s start there. What are some of the societal benefits of having the Bitcoin network? If we are investing all this power and CO2, what return are we going to get on that kind of investment?
Misallocation of capital
Wasted natural resources (see item 3)
What boggles my mind is this. The first book I ever read on the fundamentals of economics defined economics as
“the allocation of scarce resources that have alternative uses.”
And I think you and I are in consensus that the best way to achieve that allocation is through markets, right?
Now let’s explore the financial and non-financial costs of running the Bitcoin network. It is often touted that Bitcoin consumes as much electricity as a small country.
My response to that is that there are a lot of things that consume that much power but they are never compared in this way.
There is this 2019 article by Niall McCarthy that quotes the CO2 emitted by the US military to be more than countries like Sweden or Switzerland.
And anyone who justifies that is basically going back to the fundamental argument about societal priorities.
Let’s flip this argument around completely and talk about how Bitcoin is a net contributor to environmental goals.
I’m talking about things like gas flare generators and stranded power sources off-grid.