A Field of Rabbit Holes

As I mentioned recently, I’ve been spending time trying to better understand all things bitcoin. Let me assure you it’s no small task. Rabbit holes abound and you can hear that sucking sound coming from all of them. I highly recommend trying to understand the fundamentals before investing, just don’t let too much of your time get sucked away in the process.

One area of importance is just as misunderstood and argued over lately as the field of digital assets itself: Bitcoin’s energy use and whether it’s a cost of doing business or a fundamental flaw.

Lots of comparisons get thrown around about how mining bitcoin uses as much electricity as a small country does, or even several small countries. Understandably, some consider this whole blockchain/bitcoin thing a colossal waste of energy, while others see it as a sort of global financial revolution, worthy of the energy cost. Who’s right and how much does it matter?

This week I wanted to spend some time offering different perspectives on this question. There are a variety them, of course, and they tend to take on a he said, she said vibe. Here are links to three I’ll categorize as general (from Forbes), friendly (the second link, from Galaxy Digital), and critical (from Digiconomist). As you’d probably expect, the Forbes piece is the easiest read and it reviews some potential energy solutions. The others get into the weeds but aren’t too long and are worth your time if you’re interested in how bitcoin’s blockchain works and what it takes to run it.

The bottom line is that this technology and digital assets like bitcoin are here to stay but are still in their infancy. Nobody knows what this budding industry will look like in the years to come. That’s a big part of why this category is so volatile. And remember, this isn’t simply about bitcoin. There are all sorts of industries and people that stand to benefit from advancements in blockchain technology. But how to power it all and what impact this will have on the digital assets (and the world’s) ecosystem will continue to play out over time.

Continue reading...

General –

https://www.forbes.com/advisor/investing/bitcoins-energy-usage-explained/

Friendly –

https://docsend.com/view/adwmdeeyfvqwecj2

Critical –

https://digiconomist.net/bitcoin-energy-consumption/

Have questions? Ask me. I can help.