Fiat is the enemy to Climate. Not Bitcoin.
I’ve been seeing a narrative for a long time that Bitcoin is bad for the environment. I’m in some Crypto/Climate groups and there’s a general vibe of “Dropping Bitcoin” for the betterment of the climate. I want to understand the sentiment better, but to be fair I disagree with it. I am starting to realize the reason though: some people will value trust over climate, others will value climate over trust.
I guess at the end of the day, I am a trust maximalist. I believe that trust is the most important problem plaguing the world today, which is why Bitcoin is the most important piece of technology. When I say things like that, people immediately think that I hate Web3 or DeFi, but it’s not true. They are large pieces to the puzzle, but Bitcoin is the sun, and Web3 is like Saturn. I believe that Bitcoin could not be what it is today without Ethereum, but I still believe that Bitcoin is the rails that the world will be using to decentralize trust.
The core climate problem people seem to have is that the amount of energy used by Bitcoin in order to facilitate one transaction is bad the for the environment (high energy cost = bad for environment). I’m simplifying here, but this feels to be the general issue.
Maybe it’s just that I’ve been in the Bitcoin world for so long that the fact that Bitcoin is being used at all is sometimes still a surprise to me :)
The amount of energy used to verify transactions through Bitcoin feels tiny compared to moving fiat. Fiat is atoms, Bitcoin is bits. Bits are always more efficient. And if we take all the currency of the world, and all the trucks/centralized services/humans required to move that currency, and to verify trust of all of those transactions in every government over 9B people… I believe that energy used, that coal used, those facilities used - the energy used to clear one transaction will be far more costly to the environment than every block being cleared in the Bitcoin protocol and the miners.
I love that people are going to be innovating on this. They will figure out better ways to generate energy to decentralize trust… But to me, this is fighting the wrong battle. The question is not Web3 vs Bitcoin. The enemy is fiat.
I have a lot more thoughts on this, I think I may be discussing this a lot this year.
interesting perspective. what's the mpg on an armored truck?
Agree. Fiat is implicitly trusted without an incremental unit of effort (except fake currency detection machines).