Bitcoin, Climate Change, and the Kardashev Scale.

[Thekool1s]

Note: The idea behind this thread is to separate facts from myths around this subject. Every now and then we get an article claiming how Bitcoin is contributing to Climate Change etc, I want to put this issue to rest once for all. Please keep in mind this thread isn't about whether Climate Change is real or not, So Anything beyond the scope of this topic will get removed. So without further ado let's begin.


What is Climate Change?

Before we get to what is climate change, we need to define what is climate? Simply put, Climate is the average weather, typically over a period of 30 years.^[1] So any major changes in the weather system get classified as climate change. E.G If it never snowed in an area for the past 30 years and starts snowing regularly it can be defined as Climate change. The words Global warming and Climate change have been used so interchangeably that it has become one big mess! We no longer can differentiate between the two, The moment we hear the word Climate Change, All the negative things which have been linked to Global warming come to our mind. We need to separate these first. Global warming simply means ever-increasing average temperature around the globe while Climate Change is a term used to describe changes in the average weather system of a region.

Earth has its own natural Climate Change cycle which is caused by the axial rotation of the earth, movement of the continents, volcanic eruptions and sun's solar cycles.^[2] But the question here today is can Humans cause Climate to Change? The Simple answer is Yes! We have the means today to change the climate of a region. Whether it's turning deserts into farmable land ^[3] or Destroying Antarctica. Today we have the technology to do both. What I mean to say by presenting these examples is that Climate change isn't necessarily always a bad thing. It just shows how far we have come in terms of technology in the last 10,000 years. From Inventing Farming to having the ability to control the climate ^{( to some extent )} itself.

Global warming can cause the Climate of a region to change but this thread isn't about global warming itself or the harmful effects of it rather I want you to see it as a technology which can be used in the future to terraform Mars and other planets. Just like a nuclear weapon, it can make us go extinct or help us terraform other planets, Besides being a clean source of energy. This is something which needs special attention from us. If we don't handle it with care the results can be deadly. That is all I'm going to say about Global warming as I don't want this thread to head towards a global warming debate.


Bitcoin and Climate Change?

We all have come across some articles which claim Bitcoin's network now consumes XXX TW of Energy, similar to the Energy consumption of an X country and then they ramble about how the current means of energy production lead to Global warming and an unfound link is made afterwards between the two. Anybody who has dipped their toes in the world of Bitcoin Mining knows your $ KW/h will decide how long your mining operation will last or if you can mine at all. Mining Bitcoins at profit means you have to look for cheap electricity something which isn't available to all. Anything above 5 cents KW/h means your payday will depend on the price of Bitcoin when your bills are due, it can go either way. If you check the cost of electricity around the globe you will only find a handful of countries where the public has access to cheap electricity.^[4] So how do these people mine at a profit you may ask? Good question. The answer varies from person to person, Some might strike a contract with their local energy producers to get electricity at much cheaper rates than others. Some ^{( a lot )} might have access to renewable energy. Fun Fact a recent study done by CoinShares suggests 74% of Miners use Renewable sources to mine Bitcoin.^[5] Which only makes sense given there are only handful of countries where people have access to less than 10 cents KW/h.

We often forget that "Necessity is the mother of invention". For Bitcoin to exist it is necessary for its Network to exist. This Necessity of Bitcoin brings forward innovation, Ever since the first ASICs became available to the public their efficiency has only increased. This, in fact, has been shown in the recent study done by CoinShares. I highly suggest reading their findings: https://coinsharesgroup.com/research/bitcoin-mining-network-june-2019 I'm gonna leave a screenshot to give you an overview.



Like any economic free market, the competition will drive out the inefficiencies in the system. The inefficiency in Bitcoin Miner's case seems to be the cost of Electricity, at least that's what the data suggests. There is only so much which can be done to the ASICs on the miner's end, the most you can do is try different firmware modded by the community. So looking for ways to reduce the cost of electricity only makes sense. I don't see how someone can claim that bitcoin contributes to climate change or global warming just because bitcoin's network consumes XXX TW of electricity. Unless you can show us the data which presents a different story ^{( which I doubt )}. Most of this energy comes from clean renewable sources and the renewable penetration will only increase. The best argument you can make is along the lines that the amount of energy used by bitcoin's Network to append a ledger is somewhat inefficient. This is what I will address next...


Bitcoin and the Kardashev Scale

For those of you who are unfamiliar with the Kardashev Scale. The Kardashev scale is a method of measuring a civilization's level of technological advancement based on the amount of energy they are able to use.^[6] There are 3 types of civilizations, Type I, Type II, and Type III.

• Type I civilization, also called a planetary civilization—can use and store all of the energy available on its planet.
• Type II civilization, also called a stellar civilization—can use and control energy at the scale of its stellar system.
• Type III civilization, also called a galactic civilization—can control energy at the scale of its entire host galaxy.

We have still to reach the Type I status, though some say we are close ^{( in the next 200 years )} to achieving this status. I will let the gurus debate this as we are not here to debate when we will achieve this milestone but rather what this means for Bitcoin/Blockchain. Two popular schools of thought have emerged POW ^{( Proof of work, Satoshi's vision )} and POS ^{( Proof of Stake )} in the cryptosphere over the years. I align myself with POW rather than POS ^{( for reasons which are beyond the scope of this thread )}. Anyway Bitcoin's network is based on POW rather than POS. One of the main arguments against POW is it being inefficient because it uses a lot of energy for purposes of merely appending a ledger while the supporters of POW suggest that it prevents 51% attack on the Bitcoin's network and secures the bitcoin's network. Which to me makes sense, No one can overnight get access to TWs ^{( TerraWatts )} of energy and hashrate to manipulate the bitcoin's ledger. While we have seen exchanges get hacked overnight, Flash crashes etc which for me makes the POS a lot more vulnerable to manipulation.

Given that a Type I Civilization will have access to all of the energy available on their planet, Energy consumed by Bitcoin's network is pretty insignificant in the bigger picture and can be justified by the mere fact that they will have access to abundant clean energy. To put this into perspective earth receives about 174,000 TWs ^{( TerraWatts )} of energy from the sun each second, while Bitcoin's network consumes around 75 TWs per year ^[7] ... All of a sudden what appears to be an inefficient system handling global payments becomes extremely efficient. As for a Type II civilization, the number is meaningless, to say the least. For a Type III Civilization, lets just not go there.

The point of presenting these figures is that there are no Facts behind these news articles, they are often written to spread FUD in the market. Manipulating people into their agendas. They don't have the figures to back what they claim. What I need you to take away from this thread is always verify their claims, see where they are getting their numbers from because the numbers don't lie and that's what Bitcoin is based on in its core, numbers. So anytime you read another article claiming how bitcoin will/is destroying earth remember to keep calm and hodl strong

Sources:
[1] https://en.wikipedia.org/wiki/Climate_system
[2] https://inhabitat.com/the-sun-is-getting-dimmer-but-it-wont-let-us-off-the-hook-for-global-warming/
[3] https://www.youtube.com/watch?v=cazVrq9v1mE
[4] https://www.statista.com/statistics/263492/electricity-prices-in-selected-countries/
[5] https://coinsharesgroup.com/research/bitcoin-mining-network-june-2019
[6] https://en.wikipedia.org/wiki/Kardashev_scale
[7] https://digiconomist.net/bitcoin-energy-consumption

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[KonstantinosM]

Anytime I face an article or a video like that (Bitcoin wastes electricity, causes climate change, uses as much electricity as country x et cetera).

I leave a comment explaining how bitcoin is good for the environment by providing an incentive for renewable energy that can't be stored because the batteries are just too expensive and would just have been wasted.

The added financial incentive means more renewable and more renewable energy for uses other than bitcoin.



Andreas Antonopoulos has made similar points very eloquently on multiple speeches I think. Bitcoin is good for solving climate change.


I also suspect that all the "Big Dick" skyscrapers that banks own in major cities have a carbon footprint multiple times that of bitcoin. Banks are probably the ones who make and circulate most debt-based currency so including them in the Bussiness as Usual carbon footprint is only fair.

Also in the bank's footprint are all the bank employees going to work but going there is kind of pointless.



Edit: Typo, changed "to" to "too"

[Wexnident]

It's kind of an awkward Idea why they blame Bitcoin with regards to climate change instead of the countless factories and fossil fuels being burned out there which are the true causes. If you were to actually compare how BTC is compared to Fiat/Banks, this comparison posted here in the past would do wonders.

1. They have to transfer cash in armoured vehicles. <Air pollution by burning fossil fuel>
2. They spend electricity in their Bank branches. <Air Con, CCTV, Vaults, ATMs, computers, lights>
3. Running their massive server rooms and mainframes.
4. Their employees driving to work <Air pollution by burning fossil fuel>
These are just some of the things that these institutions are doing to contribute to global warming, compared to Bitcoin's small footprint.

There's also the improvement of usage of CPUs/GPUs to ASICS which drastically improved the efficiency of how Bitcoin is mined.

[kryptqnick]

Note: The idea behind this thread is to separate facts from myths around this subject. Every now and then we get an article claiming how Bitcoin is contributing to Climate Change etc, I want to put this issue to rest once for all. Please keep in mind this thread isn't about whether Climate Change is real or not, So Anything beyond the scope of this topic will get removed. So without further ado let's begin.

Thank you for doing this. I've been wanting to get to the bottom of it for a while as well. I do believe in human-made climate change because I trust the NASA data that suggests a strong consensus between the scientists on this matter. I've encountered different articles on whether Bitcoin's carbon footprint is significant or not. I've seen the data similar to what you posted, and I also thought and even wrote on Bitcointalk about this thing with civilization level and energy, so I believe the option is not to reduce the usage of electricity but to make it cleaner. Even though I agree with you on many points and want to believe that mining does not harm the environment much nowadays, since the quest here is to find out the truth, let me share a couple of articles on this matter. Here's one on The Guardian which claims the following:

In China, which leads Bitcoin mining, 60% of energy comes from coal.

Here you can see a part of another article, and this one is scientific research, that concludes the following:

They calculated that the Bitcoin network consumed 31.3 Terawatt-hours of electricity and generated 17.3 megatons of carbon dioxide equivalents in 2018, which were lower than previous estimates.

The research findings don't sound that bad, though...

[Thekool1s]

@kryptqnick, I gave the guardian article a quick read and found something really disturbing and something which I suspected. The author links to external sources where ever he can but when it comes to making the claim that 60% of the energy in china comes from coal, He has Zero Sources to back it up! This is what I said in my original thread "an unfound link is made between the two". This article is a perfect example of it. They make these figure out of thin air just like FIAT. These sources are not to be trusted until they show us where they are getting these numbers from.

[hatshepsut93]

I dunno why you have to bring in Kardashev Scale here - it's not a strong science, just some sort of futuristic prediction; it also operates on a scale of human history, which isn't really useful to dealing with todays problems, plus it's not guaranteed that Bitcoin will exist or be relevant in a few decades (even Satoshi had doubts about it).

It's simply enough to point out that Bitcoin can't be blamed for the climate change, because it's far from being the biggest offender, and it's not guaranteed to increase its energy consumption, because block rewards get reduced every 4 years.

[Thekool1s]

@hatshepsut93 Well technically speaking it isn't a prediction but rather its a model. You can apply this model to a civilization living on Alpha Centauri or 1000s of lightyears away... What do you mean that it operates on the scale of human history? This scale has nothing to do with humans. Anyway, whether Bitcoin will be around or not is another question which this topic is not about.

it's not guaranteed to increase its energy consumption, because block rewards get reduced every 4 years.

I kinda disagree with that statement, Reducing block rewards has nothing to do with the energy consumed by the Bitcoin's Network, We have seen a gradual increase over time in the energy consumed by the bitcoin's network even tho the rewards for blocks have halved. Imagine a billion humans participating in Bitcoin mining, How would the energy consumption look like then?

[hatshepsut93]

@hatshepsut93 Well technically speaking it isn't a prediction but rather its a model. You can apply this model to a civilization living on Alpha Centauri or 1000s of lightyears away... What do you mean that it operates on the scale of human history? This scale has nothing to do with humans. Anyway, whether Bitcoin will be around or not is another question which this topic is not about.

Model or prediction, either way it's completely unverifiable at the current moment - we have no idea how extraterrestrial civilizations might look like, and whether they exist or not in the first place. We also have no idea how our technology will progress, so overall Kardashev Scale can't be used to prove anything.

I kinda disagree with that statement, Reducing block rewards has nothing to do with the energy consumed by the Bitcoin's Network, We have seen a gradual increase over time in the energy consumed by the bitcoin's network even tho the rewards for blocks have halved. Imagine a billion humans participating in Bitcoin mining, How would the energy consumption look like then?

That's because the price was increasing faster than the reward was falling, and it still can be lagging behind, but if you imagine stable price, halvenings would cut the hash power and energy consumption too. But in a few decades the block reward will be measured in milibitcoins, so the price would have to be hundreds of times higher than now to keep the same level of power consumption as we have today.

[Thekool1s]

either way it's completely unverifiable at the current moment - we have no idea how extraterrestrial civilizations might look like, and whether they exist or not in the first place.

There is nothing to verify... The Type I, II and III are just a bunch of statements. A civilization which is able to utilize all of the energy which it receives from its star is classified as Type I. For our sun it's around 174,000 TWs. But this doesn't mean we have to have 100% solar efficient panels to reach the Type I status. You can use other means to reach this number and still be defined as a Type I civilization. Will recommend watching this video ^[1]. There are different kinds of issue with Kardeshev's scale which are pointed out in the video but you can verify the amount of energy which is consumed by humans or produced. I do agree with you on the part that we don't know how an extraterrestrial civilization might look like but we have some common first principles i.e we all are dependent on energy in some way, even inanimate objects are dependent on the energy of their atoms. This principle can then be used to infer that all intelligent civilizations must use energy in some form. Hence why Kardashev's scale is very much applicable.

We already produce around 28,000 TWs of energy each year and we still have around 1 Billion humans ^[2] who have little or no access to electricity. But we still have to increase this number by a million's fold to reach anywhere near the status of Type I civilization.

We also have no idea how our technology will progress, so overall Kardashev Scale can't be used to prove anything.

Nuclear Fusion alone can be scaled up to power a Type I civilization for 10,000 years from resources available on earth ^{( something which is calculated in the video I shared above )}. We don't have to invent something out of Scifi to obtain a status of Type I civilization.

That's because the price was increasing faster than the reward was falling, and it still can be lagging behind, but if you imagine stable price, halvenings would cut the hash power and energy consumption too. But in a few decades the block reward will be measured in milibitcoins, so the price would have to be hundreds of times higher than now to keep the same level of power consumption as we have today.

Yet there is no data to prove this, It's merely speculation at this point. We also have to keep the bigger picture in mind, Bitcoin is Deflationary in its nature while the FIAT we Peg it against is inflationary. We have seen cases of Hyperinflation with FIAT, Where a mere loaf of bread can cost tens of million dollars. I don't see how we can achieve a "stable price" in the long run. In fact, One can argue that there is no such thing as a "stable price" in theory at least. Each day the currencies appreciate or depreciate by a few points but we just don't see the impact of it in our daily lives because the merchants/corporations take the hit for us. Bitcoin has risen from pennies to thousands, it can reach millions too if Dollar depreciates even further.

I do get your point tho, Mining is a for-profit business mainly, So when the market drops you can expect the mining to drop as well but when you are mining something which will only be limited to 21 million in supply, it becomes a no-brainer to operate at loss in the short term if required.

Sources:
[1] https://www.youtube.com/watch?v=HEpNiOM6lto
[2] https://www.iea.org/commentaries/population-without-access-to-electricity-falls-below-1-billion