How much electricity does the world banking system use? (Answer: a whole lot more)
How much of that electricity could be used to simultaneously run the banking system AND turn incredibly ambitious renewable energy project ideas from absurd pipe dreams into economic no brainers? (Answer: none)
But this parallel financial system can also serve a tangible social good, offering an onramp to the financial system for people who would otherwise be left out.
…
Bitcoin could eliminate all these intermediaries, allowing citizens to send digital payments directly to one another, without relying on credit and without incurring multiple settlement fees along the way.
Their math is nonsense because that document compares total energy consumption instead of consumption per transaction. That’s like saying Lamborghinis are the most efficient cars on the road because their summed up fuel consumption is lower than that of all VWs or all Toyotas (or probably even all bicycles).
Re: your on chain transactions argument, you’re completely over looking (intentionally?) the fact that day to day transactions don’t need to be on chain. In fact many would argue that they shouldn’t be on chain. Layer 2 protocols can handle all of that.
Just one example scenario could be…
Step 1. Your employer opens a Lightning Network channel to your node (self hosted, or not, your call). This requires one on chain transaction (actually, there are enhancements that allow opening multiple channels in a single transaction, but that’s beyond the scope of this conversation.)
Step 2. Every month, your employer pays you over this channel. No new on chain transactions happen for this.
Step 3. You use the channel to pay your rent/mortage, utility bill, etc. Still, no new on chain transactions.
Step 4. You continue to use the channel to buy groceries, lunch, drinks for friends, a massage, etc. No on chain transactions.
Step 5. Oops, you’ve got a bill that needs to be paid in fiat. What now?!? Use the channel to transfer some Bitcoin to your bank account, where it’s automatically converted into fiat. Pay your bill from there. Still no on chain transactions.
Step 6. Return to step 2. Still no on chain transactions.
…
Step 3,658,423. 6 years later, you leave your job, Your employer closes the channel. Any Bitcoin left on your side of the channel (if any) is sent to an on chain address that you provided in step 1. This requires one more on chain transaction.
Total number of on chain transactions in 6 years and countless payments: 2
In reality, that’s probably not exactly how it would work. For instance, I would quickly just send my entire paycheck back out on the channel to a different LN channel I had open with a reliable node operator so that I wasn’t dependent on my employer keeping their node running over the weekend so I could pick up the tab at the bar. Etc
Regardless, that’s how it could work. There are countless other ways it could work, limited only by the desires and imagination of those setting up their channels, and all allowing for countless transactions over months, years, even decades, to be represented by two small on chain transactions.
You don’t think that the world banking system would use more energy if it quintupled in size? The world banking system uses more energy every time your local credit union installs an ATM at another grocery store.
And that’s why we say that per person or per transaction matters. For the amount of value it provides how much does it use? Bitcoin is worse by a lot even if its primary use was as a currency rather than an investment vehicle
Per what capita? There’s only one global banking system on Earth. That’s what makes it global. There’s only one Bitcoin blockchain, and it’s globally accessible. Trying to subdivide either into arbitrary regions based on geographic or geopolitical borders is meaningless.
How about per ‘people who are actually going to use this shit for day-to-day spending’?
I just got my mom using a password manager and still have to remote in to help her from time to time. And you wanna get her to move to digital cash that, once stolen, is unrecoverable?
At least tulips exist…
And don’t waste ridiculous amounts of electricity.
How much electricity does the world banking system use? (Answer: a whole lot more)
How much of that electricity could be used to simultaneously run the banking system AND turn incredibly ambitious renewable energy project ideas from absurd pipe dreams into economic no brainers? (Answer: none)
It’s also the world banking system for several billion people, and not a few hundred thousand gamblers.
Don’t worry, we only have to deal with the true believers as long as the price is high. Just wait.
https://www.cnbc.com/2023/03/26/bitcoin-is-poised-to-blow-up-africas-86-billion-banking-system.html
Bitcoin is for everybody.
You have a source on that? Proof of work is notoriously energy hungry… That’s the “work” part.
https://docsend.com/view/adwmdeeyfvqwecj2#
The direct answer to your question starts on page 6, but I recommend starting at the beginning to get the full context.
A crypto mining company is your source for claims that crypto mining companies operate ethically?
Can you refute their math? You asked for a source. That’s the most comprehensive data I could find. I’m happy to look at any better if you’ve got it.
Their math is nonsense because that document compares total energy consumption instead of consumption per transaction. That’s like saying Lamborghinis are the most efficient cars on the road because their summed up fuel consumption is lower than that of all VWs or all Toyotas (or probably even all bicycles).
There.
Re: your on chain transactions argument, you’re completely over looking (intentionally?) the fact that day to day transactions don’t need to be on chain. In fact many would argue that they shouldn’t be on chain. Layer 2 protocols can handle all of that.
Just one example scenario could be…
Step 1. Your employer opens a Lightning Network channel to your node (self hosted, or not, your call). This requires one on chain transaction (actually, there are enhancements that allow opening multiple channels in a single transaction, but that’s beyond the scope of this conversation.) Step 2. Every month, your employer pays you over this channel. No new on chain transactions happen for this. Step 3. You use the channel to pay your rent/mortage, utility bill, etc. Still, no new on chain transactions. Step 4. You continue to use the channel to buy groceries, lunch, drinks for friends, a massage, etc. No on chain transactions. Step 5. Oops, you’ve got a bill that needs to be paid in fiat. What now?!? Use the channel to transfer some Bitcoin to your bank account, where it’s automatically converted into fiat. Pay your bill from there. Still no on chain transactions. Step 6. Return to step 2. Still no on chain transactions. … Step 3,658,423. 6 years later, you leave your job, Your employer closes the channel. Any Bitcoin left on your side of the channel (if any) is sent to an on chain address that you provided in step 1. This requires one more on chain transaction.
Total number of on chain transactions in 6 years and countless payments: 2
In reality, that’s probably not exactly how it would work. For instance, I would quickly just send my entire paycheck back out on the channel to a different LN channel I had open with a reliable node operator so that I wasn’t dependent on my employer keeping their node running over the weekend so I could pick up the tab at the bar. Etc
Regardless, that’s how it could work. There are countless other ways it could work, limited only by the desires and imagination of those setting up their channels, and all allowing for countless transactions over months, years, even decades, to be represented by two small on chain transactions.
Per capita or in total?
Apples to apples. One global banking system to one global Bitcoin network.
So does that mean that it won’t use appreciably more electricity if it quintuples in size and volume unlike the world banking system?
You don’t think that the world banking system would use more energy if it quintupled in size? The world banking system uses more energy every time your local credit union installs an ATM at another grocery store.
And that’s why we say that per person or per transaction matters. For the amount of value it provides how much does it use? Bitcoin is worse by a lot even if its primary use was as a currency rather than an investment vehicle
Despite having millions of ATMs and banking offices, it uses less energy.
There’s probably more ATMs than Bitcoin users.
The Bitcoin network is absolutely tiny in userbase for the amount of energy they waste.
That is the opposite of apples to apples.
Per capita measurements exists for a reason.
Per what capita? There’s only one global banking system on Earth. That’s what makes it global. There’s only one Bitcoin blockchain, and it’s globally accessible. Trying to subdivide either into arbitrary regions based on geographic or geopolitical borders is meaningless.
How about per ‘people who are actually going to use this shit for day-to-day spending’?
I just got my mom using a password manager and still have to remote in to help her from time to time. And you wanna get her to move to digital cash that, once stolen, is unrecoverable?
Get real.
That’s a strong argument against password managers. We probably shouldn’t allow them, since some people are going to find them difficult to use.
ETA: Doubling the number of people using Bitcoin (especially on layer 2 protocols), is not going to remotely double it’s energy usage.
Like AI?