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Deflationary, scaling cryptocurrencies are environmentalists

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Written by   45
10 months ago

A boss-level opposition is headed towards cryptocurrencies. The opposition is spearheaded by members of the Better-Than-Cash Alliance. They come in disguise of environmentalists which they're not. Their new weapon is the argument that Bitcoin were energy inefficient. Oddly enough this opposition is at the same time heavily invested in the abolishing of physical cash and are among the biggest holders of the inflationary currency United States Dollar.

A Peer-to-Peer Electronic Cash System provides enormous benefit to mankind. It ultimately renders a whole industry branch unnecessary, the current financial industry. It will release the resources bound by that industry: Work force, space, and energy. That bears an incredible potential for our society as a whole.

The unnecessary energy consumption of the obsolete banking sector alone is an order of magnitude larger than bitcoin's. The unnecessary space consumption of the obsolete banking sector very likely amounts to yet another several orders of magnitude. The work force consumption does so too. Let me sum this up: the concept of Bitcoin is several orders of magnitude more resource efficient than the current financial system.

The benefit comes at the same time with an incredible loss of power and influence for those individuals invested and benefiting from the current financial industry. In that sense Bitcoin "has kicked the hornet’s nest, and the swarm is headed towards us". In fact this is history, the banking industry being the most powerful actors on the planet had realized this latest by 2015 and consequentially hijacked Bitcoin [1,2,3,4,5,6,7,8,9]. They strictly keep Bitcoin's blocksize limit at 1 MB.

Energy efficiency

As a direct result of the financial industry's takeover the maximum number of transactions Bitcoin can process per block are limited. Calculative a low transaction count makes for a very bad energy efficiency. This fact can subsequently and is now vocally employed, e.g. "Bitcoin uses more electricity per transaction than any other method known to mankind".

However, the blocksize does by and large not affect the energy consumption of Bitcoin. Instead the blocksize is directly proportional to its energy efficiency as @Jessquit points out rightfully. Double the blocksize and you immediately double Bitcoin's energy efficiency! The banking industry simply cannot compete with this proposition and it turns them into an endangered species fighting for survival.

Natural-resource efficiency

An aspect mostly overlooked in the debate of Bitcoin's environmental and societal impact is it's deflationary nature. Deflationary currencies appreciate in value over time. The implications of the resulting incentives are far more profound than those of the energetic aspect.

Inflationary currencies devalue over time. They continuously level the playing field between early and late adopters (between old and young members of society). Inflationary currencies hence create a strong incentive to spend. That is a great driver for economies and great tool for societies/governments who require less relative purchasing power to repay prior debts. It allows easy growth through fast consumption of resources.

Our finite planet already operates beyond its limits to growth. At this point we cannot afford to recklessly continue pushing the consumption further and further. Mankind needs to reach an equilibrium with its environment and available resources as soon as possible. It needs a currency which doesn't not incentivize spending on nonsense and spoiling resources just for the sake of it. It needs a currency that is spend when a mutual benefit is perceived worth it not due to fear of its devaluation.

That is a deflationary Peer-to-Peer Electronic Cash System which doesn't limit its blocksize. That's potentially the OG Bitcoin.

Let us not fall for the energy fallacy of a falling banking elite and of the largest holders of an inflationary currency. Real environmentalists wouldn't support government plans to delay previous climate goals from 2035 to 2050. Real environmentalists wouldn't support government plans to move the goalpost from 1.5°C to 2.0°C climate warming. Real environmentalists wouldn't support inflationary currencies.

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Written by   45
10 months ago
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