David Rosenthal: belief

Transcript context

…Yeah, fascinating point. The second theme I wanted to highlight—which is smaller and also sort of tarnished because of the ICO thing, but is I think brilliant and new about crypto and new crypto projects—is if you can reward and incentivize usage of your system by value within the system itself like with the mining set up, the rewards for mining are Bitcoin. Bitcoin is the work done by mining. That's super, super powerful. Now, there's an incentive in and of itself for people that come in and use your network. David, if there ever was an episode that we need to discuss the difference between value creation and value capture, it is this one. This is normally a two-part section. I'm going to ignore the one about, do they capture enough of the value that they create. We’ll leave for listeners to ponder on based on everything we've already talked about in this episode. I absolutely want to talk about the comparison between how does the value created for the world, not just shareholders or potentially coin holders, compared to any value destruction that they have created by existing. Of course, we've already talked about all the illicit uses of Bitcoin. Again, I'll leave that to further ponderance by the listeners, but I want to talk about the scale of the environmental impact. I surveyed some friends, what do you want to know about Bitcoin? One friend texted me and said, well is it bad for the environment or no? It's a good question. The answer is relative to what? Because sure, does it use computing power? Absolutely. How much and what do other things use? Here's at least some estimation of an answer. In 2019, MIT tried to answer this question by commissioning a study, and they basically said that Bitcoin mining specifically accounts for about 2/10 of a percent—0.2% of global electricity consumption. It produces about as much CO2 in our atmosphere as Kansas City does. That’s just a ballpark. A whole city per year. Some estimates actually put it even closer to 0.4%. Almost half a percent of the world's energy production. On an absolute basis, for anybody who knows their climate, this means 23 megatons of CO2 are put out into the atmosphere per year because of Bitcoin. Another comparison is if Bitcoin were a country using energy, it would be right between Jordan and Sri Lanka in terms of their greenhouse gas pollution. If you include other cryptocurrencies, mostly Ethereum, that actually doubles, to help you estimate how much energy is being used. I think the answer is a lot. I think there are other studies that have been done that show that mostly their mining facilities are using renewable energy. It's not like it's necessarily consuming coal or oil.…

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