Bitcoin critics have been attacking the network by claiming that bitcoin miners are inefficient and consume too much energy. These attacks are usually wrapped in faux concern for climate change, but they are almost always funded by competitive digital asset teams who are simply trying to gain an advantage through regulatory capture.
As you can imagine, the combination of money and virtue signaling can be a powerful force in the world of politics. Take the recent developments in the New York State Assembly — the politicians voted to ban bitcoin mining within the state.
While the stated goal is to remove the use of fossil fuels as an energy source, the politicians have decided to go after bitcoin miners. This is interesting because bitcoin miners, along with all data centers, have no emissions. Rather than attacking the problem from a first principles perspective, the legislation goes after the virtue signaling targeting.
Legislature haven’t gone after data centers, banks, the military, or other consumers of fossil fuel energy production. Instead, they have singled out a single industry, which happens to have the dual benefit of creating jobs and stabilizing the electrical grids, as they pursue what they believe will score political points.
But here is the interesting thing — even if you disagree with the theory that many of these attacks are being funded by competing digital asset projects, it is unequivocally true that the data disproves the logic backing these legal attacks.
The bitcoin mining council recently published their latest survey results and it found that the bitcoin network hashrate grew 23% over the last 12 months, yet energy consumption dropped 25% in the same time period. This means that the bitcoin network is becoming more efficient and continuing to refrain from any direct emissions from the bitcoin mining machines.
Whenever you hear politicians saying one thing, but the data is telling you a different story, it should peak your interest as to why there is such a disconnect.
New York State already made a major mistake in the creation of the Bitlicense, which drove businesses, jobs, and economic prosperity out of the state. By banning bitcoin mining, they are repeating the exact same mistake again. States like Texas and Florida are welcoming businesses, including bitcoin miners, with open arms. As jobs and prosperity flow to these business friendly states, it will become more obvious that the abrasive states like New York will take years to recover.
The bitcoin mining debate is no longer a debate. The network provides an ever-increasing efficiency improvement as it protects the purchasing power of hundreds of millions of people globally. Over 50% of energy used for mining is coming from renewables compared to industry averages of approximately 20% renewables in other major industries.
Bitcoin mining is winning. Politicians who don’t understand the technology or the users will complain. The entrepreneurs, investors, and operators will compete in the marketplace.
Compete, don’t complain. Build. Create. This is the way to a better future. The folks who are funding these bitcoin attacks will continue burning money while we push forward.
Hope each of you has a great day. Talk to you soon
