According to CoinDesk, in a recently released batch of emails posted by Martii 'Sirius' Malmi, an early collaborator on Bitcoin's code, Satoshi Nakamoto warned that the cryptocurrency could become a significant consumer of energy. The email release comes as Craig Wright is on trial in a case brought by the Crypto Open Patent Alliance (COPA) to determine whether he is indeed Satoshi Nakamoto, the anonymous creator of Bitcoin. Satoshi wrote in May 2009 that Proof of Work (PoW) is fundamental to coordinating the network and preventing double-spending. PoW is a consensus algorithm used in cryptocurrencies like Bitcoin to secure the network and prevent double-spending by requiring miners to solve complex computational puzzles, which in turn validates transactions and adds new blocks to the blockchain.
PoW is at the center of a debate around Bitcoin's energy consumption. While the cryptocurrency industry points to miners' use of clean or orphaned power, which would otherwise go to waste, critics are laser-focused on the raw numbers of energy consumption it generates. As a result, some jurisdictions like New York State or British Columbia have placed moratoriums on Bitcoin mining, citing the high energy consumption. Satoshi wrote that if Bitcoin did grow to consume significant energy, it would still be less wasteful than the labor and resource-intensive conventional banking activity it would replace. 2021 research from Galaxy Digital showed that Bitcoin uses half the energy of the banking or gold mining industries.
Satoshi also foresaw non-financial uses for blockchain, such as serving as an open-source notary, allowing users to securely timestamp documents to prove their existence at a specific point in time. He was concerned that labeling Bitcoin as a sort of investment might bring legal scrutiny from authorities and advised against explicitly saying, 'consider it an investment'. Since then, the Securities and Exchange Commission (SEC) has engaged in a long campaign of legal warfare around the use of this word and might classify a cryptocurrency as a security and crypto exchanges as dealing with unregistered securities.
