Bitcoin critics have not relented in reiterating their consensus belief that Bitcoin allows for an excessive waste of energy due to the high demand of electrical power needed for mining activities. While it is indeed true that Bitcoin mining consumes a truckload of energy, an interesting case for Bitcoin mining as an essentially valuable practice for the environment has just been made by the prominent crypto asset analyst Yassine Elmandjra. Elmandjra who holds the position of asset analyst of ArkInvest compiled his assertion in a Twitter thread, in which he notes that overall, “Bitcoin does not waste energy.”
As an introductory point, he notes that for the preservation of decentralization, a key quality that is paramount to Bitcoin’s identity, Bitcoin mining is a necessary activity.
“First, proof-of-work mining is critical to Bitcoin. In the Bitcoin network, trustworthiness is protected by computation, and mining is what gives Bitcoin its ability to coordinate trust and facilitate the transfer of value without relying on a centralized authority.”
Proving his point further, he added that against the United States dollars which is inherently dependent on continual printing to sustain its value, Bitcoin converts cheap energy into a globally sustainable store of value.
“The costliness to produce bitcoin is fundamental to its value. Unlike the US dollar, Bitcoin cannot be printed with the stroke of a keyboard. Instead, it converts the output from cheap stranded energy sources into something with monetary value.”
Among other things, he highlighted some key points, most of which detail the result of Bitcoin mining as a practice that consumes methane, which later helps to reduce dangerous greenhouse emissions that could have otherwise been distributed to the atmosphere.
Bitcoin as a store for excess energy
Meanwhile, some countries have begun to adopt the practice of transferring excessive energy into Bitcoin mining operations. Early this year, multiple sources claimed that the leading oil subsidiary of the Russian natural gas and global energy company Gazpromneft will allow Bitcoin miners to leverage the excessive gas through the inception of an on-site mining operation.Â
In a similar fashion, Ukraine recently revealed that it had plans to allow the importation of the country’s excess nuclear power into crypto mining. The adoption of this practice may help developing economies create a booming revenue source if successful. For Ukraine, the implementation of this practice creates an opportunity for the country to benefit from tax returns paid by mining companies, while international investment interest could potentially become a highly profitable source of income.
