A short explanation why government are willing to support bitcoin and Proof of Work Blockchains. (I hope we can start an open discussion here)
I think this is a serious issue the blockchain world will need deal with, if blockchain and bitcoin experience an exponential user acceptance globally, the energy consumption for mining could skyrocket. Btw not only mining but the increased usage of internet and data transmission, that may come with blockchain applications, could also be additional catalysts for power shortages.
And btw, which countries could have the incentive of driving up energy demand? USA, oil exporter, Russia and OPEC, These countries have every incentive to drive up the price of Bitcoin to dream levels of a million usd, it would cause massive mining wars, increasing energy output and higher demand for energy.
China on the other hand doesn't need Bitcoin, its not an energy exporter, NEO the only possible official chinese crypto in the future (yes i know there is fud about china and crypto, but do you think projects like "the key" that have 120 million people as test subjects, can hapen without government influence, its big LMAO) , is not proof of work its proof of stake, just fyi.
Venezuela - petrodollar - can be mined (proof of work) - value is 1:1 with oil!!!!!
Call me crazy, but if it aint obvious to anyone, then there is nothing else I can do.
If i was a government and had a say, I'ld do anything to ban energy intensive cryptos from exchanges wherever i can. But what if i was an energy exporting country, perhaps i'ld promote it? Bitcoin is obviously backed by financial institutions and governments, it will always be mainstream. (its backed without doubt, lighting network being the reason, i wrote an article about it) The world is already fighting an energy deficit, and in the war against global warming and trying to get rid of fossil fuels, i think that energy consumption for mining could be seen as a catalyst for disaster.
What about energy poor countries, and people in these countries start to use energy to mine crypto, instead of only using regular household tasks, it would skyrocket energy prices in developing regions.
We could see more power cuts in developed countries. We could see a driving oil demand to make up for a short deficits that could occur, it sounds crazy, but it is a serious possibility in my opinion. Whats faster building a few new power plants with the newest tech, or driving up fossil fuel imports? beats me. We could see a rise in nuclear power in order to fight the deficit that we cant fix with renewable just yet. (BTW China is building 200 nuclear power plants anyway right now).
OPEC countries need to find new clients, China might be the no.1 consumer for oil, but their demand will not grow exponentially anymore, as they become more and more energy independent over the next 5 years. Instead other consumers must raise their demand somehow, but how could you possibly spur demeand alll of a sudden? In a world world where fossil fuels are losing their competitive advantage over long term. China Has done the correct decision to not support bitcoin and mining activities in their country, its common sense if you are not part of the game and have no chance of getting some revenue out of it, then get rid of it.
There are some mainstream media articles that call crypto mining not to be a problem for energy consumption, but I'm someone who questions the incentive of such an article, after all its financial institutions who finance big stream media companies. You follow mainstream media and believe what they tell you, you will never earn a buck on investments. I read the exact opposite (its how i made my best stock calls so far as well)
I'm very much pro blockchain, but I'm absolutely against proof of work built blockchains, as a global community they may have more passsive harm on us than we could imagine.
As good as blockchain tech is, we are not dealing with the downside it may bring with it, at least not enough. And blockchain is still in its baby steps. We are no where near a mature market.
I will leave some articles as links for people to read up on.
And don't ever forget the biggest incentive of crypto, we cant track who actually owns how much crypto, heck we dont even know who Satoshi is. I know it sounds like Conspiracy material, but someone please bring me material against my point of view so I can calm down here.
Venezuela’s proposed 'petro' is a risky bet, with purported combination of cryptocurrency, oil reserves
Bitcoin energy use in Iceland set to overtake homes, says local firm
http://www.bbc.com/news/technology-43030677
The Cryptocurrency Mining Energy Problem
https://cryptobriefing.com/cryptocurrency-mining-energy-problem/
One Bitcoin Transaction Now Uses as Much Energy as Your House in a Week
Bitcoin Mining Uses As Much Power As Ireland. Here's Why That's Not A Problem
https://cryptobriefing.com/cryptocurrency-mining-energy-problem/
No, bitcoin isn't likely to consume all the world’s electricity in 2020
Bitcoin’s insane energy consumption, explained
https://digiconomist.net/bitcoin-energy-consumption
Why Governments Might Join the Cryptocurrency Craze
I don't think mining will be around forever, it is slowly being supplanted by PoS. But you are right, it's using a lot of energy and it's not good for the environment.
I agree and I love proof of stake, sadly there is a big incentive for other stakeholders to push proof of work cryptos
Thanks for commenting :)
Rene,
A well written article as well as very informative and thought provoking. I like that!
You toggled my brain to do a quick google search on the status of the Venezuelan proposed "petro" cryptocurrency. It is suppose to be released on February 20th. I will watch, just because of the potential and especially to see what, if any response will be.
Here's the article I googled:
https://www.nrgedge.net/article/1518567881-venezuelas-proposed-petro-is-a-risky-bet-with-purported-combination-of-cryptocurrency-oil-reserves
Click the link in the article at the end for a more in-depth article about the offering and possible ramifications.
In closing, the interesting item that popped up in the article to me was this: "U.S. officials warn investors against acquiring petro coins, informing prospective buyers that such activity could violate U.S. sanctions, which ban purchases of new Venezuelan debt."
Technically, purchasing the cryptocurrency wouldn't be debt, my definition of what debt is considered. Gamble, yes, debt, no.
Just sayin... :)
Hi Wesley, Thanks for the article, ill actually add it as a reference to this article, to raise awareness
Yes i think international acceptance for this petro-dollar, is hopefully gonna be none at all, Because i really want to see this regime go, but we never know who the international buyers will be (Russia most likely and black market??, I can imagine it implenting itself as a crypto exit stragtegy in tether/monero Style, get out of a bear crypto market but stay hidden?), since holders will always be anonymous. But I think we will be able to derive who holds this crypto, by seeing what exchanges will accept this crypto, I speculate russian exchanges will allow it. (Russia is also the biggest creditor for Venezuela anyway)
If they do KYC for the ICO, who will actually see these files, investors are never disclosed, we will never know who is going to be taking part in the petro-dollar.
there will be international pressure to NOT have this currency available on exchanges too, I hope.
If ild go for a proof of work ild always choose Bitcoin or Litecoin due to their market acceptence reached already,
New proof of work cryptos are not as competitive as running proof of stake (from a tech side), and will just be created for the incentive of mining, but where is the real profit for miners to be made? in new altcoins where your mining share can be big because no one is mining it yet, or in Bitcoin/litecoin, where the competition is huge, but 1 BTC or 1 LTC would be big enough of an incentive to work for (if values reach sky high levels)
I definetly dont want to recommend the purchase of the petro dollar, i hope readers dont get this idea form this Short article, oh dear......
But I dont think we can consider the purchase of crypto as a debt, that sure is a loophole.
Bullish news about Bitcoin? Awesomeeee
lets call it, a bullish theory :)
but i think its worth mentioning
i just upvote and follow u ,, kindly follow me back and upvote to given link ,, then i will uppvote your 5 more posts
https://steemit.com/newshub/@awais55/kashmir-why-india-and-pakistan-fight-over-it
i just upvote and follow u ,, kindly follow me back and upvote to given link ,, then i will uppvote your 5 more posts
https://steemit.com/newshub/@awais55/kashmir-why-india-and-pakistan-fight-over-it
Agree 100% proof of work is wasteful and time consuming, I think because of that it won't have the exponential user base growth, because if the costs get that high I think the smart money will move to more globally scalable cryptocurrencies. The smart money will catalyze the movement away from proof of work and towards something else once the mainstream finance guys realize how much energy it would take for proof of work to function on a large scale.