Square has written a memo titled "Bitcoin is Key to an Abundant, Clean Energy Future". What are your thoughts on the piece?
Can you explain more about what you mean by this? Would the same apply to a gallon of gas burned in a car for example?
Bitcoin is fundamentally a casino. It’s only legitimate function is betting on a number that’s not connected with anything else, also known as gambling. The energy we spend there does much less for a society than allowing people to move around and go about their daily lives.
So far the resounding answer has been “number go up”. Well, that and crime if we’re being honest.
> Bitcoin miners are unique energy buyers in that they offer highly flexible and easily interruptible load, provide payout in a globally liquid cryptocurrency, and are completely location agnostic, requiring only an internet connection. These combined qualities constitute an extraordinary asset, an energy buyer of last resort that can be turned on or off at a moment’s notice anywhere in the world.
So for anyone else reading, the premise is to capitalize during times when there is excess energy being generated. So instead of trying to figure out how to store that excess, you can expend it mining bitcoins.
It does make investing in green energy more attractive, since you don't end up throwing away excess energy, which makes the claim "Key to and Abundant, Clean Energy Future" somewhat defensible. But investors will have to consider other things like cost of energy storage and cost of maintaining a competitive mining rig, and who knows, the reality might be that burning up the excess for bitcoin is still not a good trade.
I also don't see increased attractiveness of green energy to investors, mining efficiency, and pollution output of the bitcoin network having strong correlations with each other. Maybe it might help increase the percentage of green energy in the energy sector, which in turn reduces the amount of brown energy being expended mining bitcoin, but, that would be more of a second order effect, and we can only make postulations at that point.
Agreed this seems hard to pin down.
For those like me not familiar with the term "brown energy": "energy produced from polluting sources as a contrast to green energy from renewable, non-polluting source"