Digital Assets: Michael Saylor Takes Up The Cudgels For Bitcoin On Energy And Climate Change
A report published last week by the U.S. Office of Science and Technology Policy claimed that electricity usage from digital assets was contributing to greenhouse gas (GHG) emissions.
Michael Saylor, Executive Chairman, MicroStrategy (NASDAQ: MSTR) has issued a blog post titled “Bitcoin Mining and the Environment,” presumably in response to the White House report, and drew attention to his riposte via a tweet on September 14:
— Michael Saylor⚡️ (@saylor) September 14, 2022
First, what the Government report said
The report from the White House said:
“Crypto-assets are digital assets that are implemented using cryptographic techniques, and have a total current global market capitalization of nearly $1 trillion. However, some crypto-asset technologies currently require a considerable amount of electricity for asset generation, ownership, and exchange.”
“Electricity usage from digital assets is contributing to GHG emissions, additional pollution, noise, and other local impacts, depending on markets, policies, and local electricity sources. Depending on the energy intensity of the technology used, crypto-assets could hinder broader efforts to achieve net-zero carbon pollution consistent with U.S. climate commitments and goals.”
Response from Saylor
· Bitcoin runs on stranded, excess energy, generated at the edge of the grid, in places where there is no other demand, at times when no one else needs the electricity; it uses the least valued, cheapest margin of energy left after 99.85% of the energy in the world is allocated to other uses.
· Bitcoin mining is the most efficient, cleanest industrial use of electricity. ~59.5% of energy for bitcoin mining comes from sustainable sources and energy efficiency improved 46% YoY. No other industry comes close.
· Bitcoin is far less energy intensive than Google, Netflix, or Facebook. Approximately $4-5 billion in electricity is used to power & secure a network that is worth $420 billion as of today (The value of the output is 100x the cost of the energy input).
· It makes no sense to compare Proof of Stake (PoS) networks to bitcoin. PoS Crypto Securities may be appropriate for certain applications, but they are not suitable to serve as global, open, fair money or a global open settlement network. On the other hand bitcoin is a digital Commodity without an issuer (“digital gold”) – an innovation achieved only once in the history of the world. (Emphasis added)
· Bitcoin mining is neither the problem nor the solution to the challenge of reducing carbon emissions. It is in fact a rounding error, because 99.92% of carbon emissions in the world are due to industrial uses of energy other than bitcoin mining.
· On the other hand, bitcoin is beneficial to the environment because it can be deployed to monetize stranded natural gas or methane gas energy sources.
· Because a bitcoin miner can monetize any power source, anywhere, anytime, at any scale, his operation is a clean, profitable and modern industry that generates hard currency to a remote location in the developing world, connected only via satellite link. It is therefore an instrument of economic empowerment, globally.
Related Story: MicroStrategy Posts Q2 Loss Of $1B; Saylor No Longer CEO
Image credit: https://www.michael.com/en/biography
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