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Crypto VC Thoughts: Digital Money Pushes Energy Companies to Innovate

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Written by ย ย 34
1 month ago

In the past decades, people bought into the idea of Bitcoin ๐ŸŸก.ย 

They think Bitcoin is the future of money simply to believe:

๐Ÿ‘‰ censorship-resistance

๐Ÿ‘‰ store of value

๐Ÿ‘‰ hedge inflation

๐Ÿ‘‰ accessible

๐Ÿ‘‰ liquidity

๐Ÿ‘‰ anonymity

๐Ÿ‘‰ transparency

๐Ÿ‘‰ potential high returns

๐Ÿ‘‰ 24/7 market opens

๐Ÿ‘‰ open source

๐Ÿ‘‰ and many more

which outweighs the risks:

๐Ÿ‘‰ volatility

๐Ÿ‘‰ unregulated

๐Ÿ‘‰ irreversible

๐Ÿ‘‰ hackable

๐Ÿ‘‰ limited use

๐Ÿ‘‰ potential lost everything through loss of wallets

๐Ÿ‘‰ unknown technical flaws

๐Ÿ‘‰ built-in deflation

๐Ÿ‘‰ no valuation guarantee

๐Ÿ‘‰ highly speculative

๐Ÿ‘‰ easily influenced by the market/whales

๐Ÿ‘‰ haven't proven long term investment

๐Ÿ‘‰ scalability challenge

๐Ÿ‘‰ and many more

Both lists can go on for a while, depending on market evolution.

Each point is a great debate topic that one can research deep into and find pro and con lists.ย 

But I want to focus on the energy consumption of Bitcoin in this article โšก.

As you may know, I am a super bad on the investment and pick $Luna as a potential investment. So you want to verify my search ๐Ÿ›ธ.

๐Ÿ˜… Here we go.

๐Ÿ”‹ Bitcoin energy consumption

Here are breakdowns:

Image credit: https://www.moneysupermarket.com/gas-and-electricity/features/crypto-energy-consumption/


Single transaction: 1,173 kWh ~ $173

Annal total footprint: 123.75 TWh ~ $11.03B


The additionalย researchย to identify cryptocurrency's energy usage will rise another 30% or additional 32.5 million metric tons of carbon dioxide a year to put more social burden on the economy.

New York City has been looking to ban Bitcoin mining for two years, but the city decided to drop theย banning billย at the last minute.ย 

There are two sides to the debate on energy consumption and whether it will be sustainable in the future.

Image credit: https://www.coindesk.com/business/2021/08/18/how-much-energy-does-bitcoin-use/

The result can be drastically different depending on how you look at the issue.

Image credit: https://www.coindesk.com/business/2021/08/18/how-much-energy-does-bitcoin-use/

Banksย can cost more than Bitcoin if you count all banking operations as a whole.

Or you can argue that Bitcoin costs more than the entireย country of Argentina's power consumption is.

But here, I will show how Bitcoin can change the energy industry.

1๏ธโƒฃ Natural monopolies

Energy companies areย natural monopolies. They do not concern about innovation that much but dominating the market.ย 

Bitcoin gives them a reason to innovate. If they can produce cheaper power with more energy output, they have a greaterย margin of profits.

2๏ธโƒฃ Protectionism

Energy companies spend money toย protectย from replacement by providing better and cheaper energy to consumers.ย ย 

Bitcoin can push them to enter a competition to provide better services through technology innovation.

3๏ธโƒฃ Support valuation

Energy companies can support the value of Bitcoin to make it restore its valuation rather than a speculative asset.

4๏ธโƒฃ Government regulations

The government can easy to regulate energy companies and Bitcoin indirectly. It benefits both sides.

๐Ÿค” My thoughts:

I will not guarantee that is a future of Bitcoin, but it seems energy companies entering into crypto is a better outcome than the bank will do.ย 

What is the point of buying and holding to praise for the price to increase at any time in the future without ever using it in the future ๐Ÿ˜?!ย 

๐Ÿ‘‹ Follow meย here

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Written by ย ย 34
1 month ago
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