How to debunk the Bitcoin Energy Consumption drama

[DOPECOINRULES]

On May 31, 1999, as the dot-com economy was beginning to take off, a Forbes article was published that claimed that it was “reasonable to project that half of the electric grid will be powering the digital-Internet economy within the next decade.” The piece accused the internet—and, specifically, hardware companies—of “burning up an awful lot of fossil fuels” and setting the world on a dangerous trajectory of energy usage.
 


When the California energy crisis hit in 2000, resulting in a nationwide conversation about energy usage, this narrative entered the mainstream. Dozens of other high-profile publications cited the Mills report, claiming that the internet was on track to gobble up the national energy supply. Internal reports by JP Morgan, Bank of America, and Deutsche Bank also cited these figures “with little or no indication that there was even a debate about them.” For such a provocative claim, there was a shocking degree of consensus.

The problem? The projections were wrong. Mills’s calculations were fraught with errors, resulting in a figure for internet power usage that, according to subsequent estimates, was at least a factor of eight too high. The data today, two decades after the Forbes article, clearly illustrates that these doom-and-gloom projections were way off-base. Even the most aggressive projections today show the internet only consuming 20% of electricity by 2025, and many tech giants are fully transitioning to renewable energy.

Read everything at the following link and please share it everywhere. If you are on Twitter, tag Elon as he needs to get bombarded.
https://www.veradiverdict.com/p/bitcoin-energy-consumption

Neptune riding the waves

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[AakZaki]

It looks like he's going to start at the bottom again. After reasoning rejecting Bitcoin because it is not energy friendly and energy consumption is too large because it is against Tesla's mission. But it seems like we are too stupid to believe that straight away. She continues to collaborate with her doge. Does doge not consume energy like Bitcoin. Maybe the answer is no if Elon answers it. But what power he has become a person who is able to change the state of the market, at that time like McAfee. But now that he's gone, maybe later Elon will be like McAfee he'll disappear from the hack. So that new people will appear in Crypto.

[lionheart78]

Energy consumption isn't equal to environment pollution.
Bitcoin miners aren't guilty for the environmental pollution,the coal burning power plants are guilty.
What if the Bitcoin miners are buying electricity from nuclear power plants or hydroelectric power plants?Those power plants aren't polluting the environment.
All the dumb people are just "Big Energy consumption-BAD for mother nature.Low energy consumption-GOOD for mother nature" which is wrong.This is a really dumb narrative.

It is so sad to think that technology advance but the way many people think stay primitive.  When an unupdated person heard of energy consumption they automatically think coal burning, oil drilling without even thinking that there are alternative ways to get energy such as from wind, geo (geothermal energy), solar which is very nature friendly.  Elon Musk just loves drama and spotlight, he knows these things (sources of energy) all along but he wanted his statement to be the talk of the cryptocurrency industry thus he deliberately releases that statement.

[acquafredda]

One should simply point out, first of all, that a tiny 19% of power came from low-carbon energy sources in 2019. This means we are so distant from a green transition and thinking that bitcoin is polluting the world and destroying the environment is simply very stupid.
The article has a lot of data to avoid focusing on the finger while looking at the moon (if you don't know those words originally came from Confucius “When a wise man points at the moon the imbecile examines the finger.” )

[NeuroticFish]

Calculating the energy consumption for Bitcoin (apart from extrapolation) also neglects the fact that the whole banking system requires energy as well. A lot of energy if think it through from the very first step to the very last.

Bitcoin energy narrative always ignored the energy wasted by other activities or industries, nothing new under the sun.
And let's say that banking is probably not even that much energy hungry, but just think on advertising, or physical casinos, or, as I've read somewhere, the Christmas lights...

Actually, the extrapolation works here, if the reward double so does the miner revenue so grows the amount of energy they can pay for mining.
Double the price, double the income with a bit of ignoring ROI, and wages and maintenance double the amounts of kwh burned.

Yes and no. We don't know what the future holds. One example is the ever rising difficulty, decreasing the income/kWh.
And the advance of technology is not always able to cope, leading to increase of consumption for the same revenue.
(And if the technology is advancing, the gears are not for free either).
So.. the "formula" is more complicated and not as easily predictable.

[DapanasFruit]

If you are on Twitter, tag Elon as he needs to get bombarded.

We know that Elon's narrative on Bitcoin CO2 footprint is weak, at least because Tesla knew all this before buying Bitcoin and before accepting it for car payments.

So imho the fact it's an old narrative taken back up from the dusty vaults it's not of great importance.
Plus, we already know that extrapolations are wrong:

I fully agree with this. Elon Musk is not some sort of child that will choose a candy at a whim and seconds later will just throw the candy away. I mean he is a genius and I don't think a man of his stature will decide on anything without considering all the factors - and with Bitcoin he must have known that some people are questioning the energy involved in mining the coin. And now he is pretending to have some sort of buyer remorse, and yet he is hodling on to the Bitcoin they already have -- and it is because even if he thinks that Bitcoin is bad for the environment he is sure it is good with business and making good profits. In other words, we are witnessing a man who is a hypocrite at the very least. People who in cryptocurrency must stop following this man and must stop the kind of influence he is wearing.

[pubhonest1]

Bitcoin price falling as a result of this, Elon why

[stompix]

Yes and no. We don't know what the future holds. One example is the ever rising difficulty, decreasing the income/kWh.
<>
So.. the "formula" is more complicated and not as easily predictable.

The formula is pretty simple, as you start from  solid base you will not be able to spend more on energy than you get in reward.
Here is one pretty good thanks to burtw

Also, what do you mean by the increase in difficulty?

The increase in difficulty is an effect of the increase in reward, remember that last year at 10k we were doing 100 Exahash, now we're doing barely double with 5 times the reward, the consumption is barely keeping up with the price because of chip shortage that leads to both Bitmain and  MicroBT get sold out even if customers are ready to pay triple the price.
I've got an insane deal buying 3 miners at just 2 and a half the price of last summer, if enough mienrs would be available at this moment you will see difficulty do another x2 in a month.

[mindrust]

On May 31, 1999, as the dot-com economy was beginning to take off, a Forbes article was published that claimed that it was “reasonable to project that half of the electric grid will be powering the digital-Internet economy within the next decade.” The piece accused the internet—and, specifically, hardware companies—of “burning up an awful lot of fossil fuels” and setting the world on a dangerous trajectory of energy usage.
  


When the California energy crisis hit in 2000, resulting in a nationwide conversation about energy usage, this narrative entered the mainstream. Dozens of other high-profile publications cited the Mills report, claiming that the internet was on track to gobble up the national energy supply. Internal reports by JP Morgan, Bank of America, and Deutsche Bank also cited these figures “with little or no indication that there was even a debate about them.” For such a provocative claim, there was a shocking degree of consensus.

The problem? The projections were wrong. Mills’s calculations were fraught with errors, resulting in a figure for internet power usage that, according to subsequent estimates, was at least a factor of eight too high. The data today, two decades after the Forbes article, clearly illustrates that these doom-and-gloom projections were way off-base. Even the most aggressive projections today show the internet only consuming 20% of electricity by 2025, and many tech giants are fully transitioning to renewable energy.

Read everything at the following link and please share it everywhere. If you are on Twitter, tag Elon as he needs to get bombarded.
https://www.veradiverdict.com/p/bitcoin-energy-consumption

There is a problem with your logic. The banking service Bitcoin provides is no where near of legacy banking. I don't know how much electricity common banking consumes and I expect it to be very high but on the other hand the amount of services they provide are also a lot. VISA alone probably verifies more than 30% of the credit card transactions.

According to this page (https://www.statista.com/statistics/278970/share-of-purchase-transactions-on-global-credit-cards/), it is 50%.

How many transactions go through btc? 525960 * 10 at best and in return, it consumes more electricity than Sweden. And while the number of transactions btc enables will stay same, the energy consumption will only rise exponentially. I don't think that is sustainable.

[Kakmakr]

People are trying so hard to compare the Fiat payment system footprint with Crypto currency footprint, but they cherry pick the inputs. You cannot just take selectively and then bundle all aspects of the competitor and then exaggerate the result.

Example : A Bank transaction is so much more than the single entry that are done on a database within the Banking system.... these transactions are done on a server that are located in a secure server room... with 24/7 air-conditioning and 24/7 security system. (CCTV/Guard houses with lights and aircon etc.)

The transaction might originate from a ATM that consume electricity, even if it is not used (24/7) and those ATM's are monitors and controlled remotely from within a control center, with it's own electricity usage. (All these devices are manufactured and recycled and that process use electricity)

We can go a lot deeper...... 

[NeuroticFish]

The formula is pretty simple, as you start from  solid base you will not be able to spend more on energy than you get in reward.
Here is one pretty good thanks to burtw

Actually the theory and the reality not match always, and that's basically my point.
And in the summer of 2016, while some miners were disconnecting, I am almost certain that not all of them were mining on profit. And it's clearly not the only case. And if it has happened before, it can probably happen again.

Also, what do you mean by the increase in difficulty?

The increase in difficulty is an effect of the increase in reward, remember that last year at 10k we were doing 100 Exahash, now we're doing barely double with 5 times the reward, the consumption is barely keeping up with the price because of chip shortage that leads to both Bitmain and  MicroBT get sold out even if customers are ready to pay triple the price.
I've got an insane deal buying 3 miners at just 2 and a half the price of last summer, if enough mienrs would be available at this moment you will see difficulty do another x2 in a month.

The relationship between increase of reward and increase of difficulty is not necessarily as you say. It's somewhat similar to "what was first, the chicken or the egg?".
With the current semiconductor shortage the situation is unnatural an indeed the difficulty doesn't rise as much as expected, but, on the other hand, isn't this yet another sign that the overall rule doesn't always work as expected?

[Karartma1]

What I found exceptionally spot on reading the article in OP is that basically the Internet had to suffer the same bullshit. Today's bitcoin turn ok, but I think the environmental attack is yet another attempt to take the king down in favor of the crazy horseshit boiling in the other blockchain pot.
Yes, bitcoin consumes energy, so what? it's called progress. and that's how it works

[KaliLinux]

If you are on Twitter, tag Elon as he needs to get bombarded.

We know that Elon's narrative on Bitcoin CO2 footprint is weak, at least because Tesla knew all this before buying Bitcoin and before accepting it for car payments.

So imho the fact it's an old narrative taken back up from the dusty vaults it's not of great importance.
Plus, we already know that extrapolations are wrong:

I fully agree with this. Elon Musk is not some sort of child that will choose a candy at a whim and seconds later will just throw the candy away. I mean he is a genius and I don't think a man of his stature will decide on anything without considering all the factors - and with Bitcoin he must have known that some people are questioning the energy involved in mining the coin. And now he is pretending to have some sort of buyer remorse, and yet he is hodling on to the Bitcoin they already have -- and it is because even if he thinks that Bitcoin is bad for the environment he is sure it is good with business and making good profits. In other words, we are witnessing a man who is a hypocrite at the very least. People who in cryptocurrency must stop following this man and must stop the kind of influence he is wearing.

IMO I believe for that part, Elon musk must have taken profits off the Bitcoin he bought because I don't suppose he would be doing this knowing fully well that it will result negatively to Bitcoin price and still hold.
On the other hand, I thought the same thing too, Is it that Elon Musk is saying that an organization like Tesla and himself did not know all the details involved in Bitcoin mining or rumored surrounding Bitcoin in terms of energy consumption for mining before making that decision? IMHO, I believe that Elon did this just to show how much he can manipulate the market to his own advantage since there have been studies that have also shown that Bitcoin mining doesn't really consume what is been claimed.

[BlackHatCoiner]

Bitcoin will consume as much energy as the block reward will allow it to, if it drops to 100$ the consumption will drop 100 times too

This is non-sense. Why would it drop 100 times if it was evaluated with $100?

if doge goes to 1 million dogecoin will burn also more energy than this planet could produce.

Due to this phenomenon, I guess that governments will sooner or later find their way to illegalize the use of ASICs, if renewable sources of energy aren't that productive yet. Thus, this formula won't be valid forever. Mining is a greedy game and fortunately, it can be controlled in a way. Do you really believe that Bitcoin will destroy the planet? C'mon.


As for this:

How to debunk the Bitcoin Energy Consumption drama

I always carry this image when someone brings this topic:

 

[stompix]

The relationship between increase of reward and increase of difficulty is not necessarily as you say. It's somewhat similar to "what was first, the chicken or the egg?".

Can the difficulty increase once it has his miminum profitability without an increase in price? No, it can't.
We had tens of those evens in the past, mienrs staing on the shelves as there was no incentive to add more hashrate since the profits were marginal.

Have we seen difficulty spikes long after the price has stopped growing? Yes we have again seen it numerous times, look now, the overall difficulty despite those flops is still up 6% and Bitcoin is not at all near the ATH, the difficulty keeps rising and it will keep rising even if we drop to 30 the break-even point is well below the current price for the number of miners we have on right now.

There is no chicken and egg, the difficulty follows the reward, sometimes it might now keep up p with it but never has the difficulty dictated the price.

With the current semiconductor shortage the situation is unnatural an indeed the difficulty doesn't rise as much as expected, but, on the other hand, isn't this yet another sign that the overall rule doesn't always work as expected?

It's a freak situation, simple as that, it can't be a perpetual state of affairs and its effects will soon be negated.

Bitcoin will consume as much energy as the block reward will allow it to, if it drops to 100$ the consumption will drop 100 times too

This is non-sense. Why would it drop 100 times if it was evaluated with $100?

Because miners would only make $90k instead of $45m.
How many miners can you feed with $90k even at 1cent per kwh? Oh, let me answer that for you, around 100k S19pro, so just 11 Exahash.
1cent/kwh , no ROI no cooling, no maintenance, no profit.

I always carry this image when someone brings this topic:

Before posting it you should check the date of the study;)

The source for your image says:
Source: ARK Investment Management LLC, 2020. Data Source: https://medium.com/@danhedl/pow-is-efficient-aa3d442754d3
That quotes a study from 2014:
https://www.coindesk.com/microscope-economic-environmental-costs-bitcoin-mining

[kryptqnick]

It's a good story, and I haven't heard of it before. That being said, the Carbon footprint is getting bigger over time, and surely the development and mass adoption of various technologies contributed to that. As for the estimates being very off, it's good that they were and that it's not as bad as some thought it would be. I also think that it was indeed uncalled for to stop accepting BTC payments since it's really hard to fully assess the real impact of BTC (because often the sources of electricity for mining aren't known) and to compare it with the impact of other things. However, I do think that the energy sources matter and the issue of fossil fuels shouldn't be disregarded.

[reelstuff]

There is almost always a reason behind fluctuations in the market, (really any market) it is not always obvious but one thing is clear it is just as likely that a pigeon that was perched on a fiber line farted and caused the whole thing.   ridiculous yes, same as the idea that one opinion could influence millions of cryptocurrency investors to suddenly stop supporting the market.

  Even if Tesla stops accepting crypto, how many investors were on their way to the dealership to buy one?

  No, that does not fly in any real way.   IT is far more likely that over leveraged margin traders got a call or banking deposits had to be reconciled,  another not obvious likely cause.

  all of these things contribute to an issue but what is going on right now is manipulation, no other way about it.   You can see it clearly in the order book.

  Someone has a big bet out on puts and that is the real problem.

  When a whale or a corporate presence manipulates the price of BTC in order to win a bet.

  It not only affects everyone that holds and trades crypto but everyone else who cannot engage the market because the price will not go up and it will not go down far enough to make it profitable to engage in the market.

  If you bought the dips prior to the new Low, 48 to 50 then you are stuck unless you take the loss and short it.

  You might be tempted to buy more but that is not a healthy method of getting out of a hole.

  The only thing you can do is wait until those options expire and the market returns to a state where the price is not held down by artificial means.

[NeuroticFish]

Can the difficulty increase once it has his miminum profitability without an increase in price? No, it can't.

But the price can fall, crypto winter can go for months (years?) and the difficulty won't fall that much, not proportionally at least.

There is no chicken and egg, the difficulty follows the reward, sometimes it might now keep up p with it but never has the difficulty dictated the price.

It was said in many occasions that the difficulty follows the price and it was said in many occasions that the price follows the difficulty sooner or later. So.. yeah...

It's a freak situation, simple as that, it can't be a perpetual state of affairs and its effects will soon be negated.

Freak situations, exceptions, .. name it. There are always cases to show that the rules don't always work. Isn't that the point of all this discussion?

[acquafredda]

since my friend fillippone started an even better thread which now includes the article I posted here, you guys can keep discussing it there as I do not see any point in splitting what I find one of the most important discussion of the btc world recently.
For this reason, I will lock this thread and you can move to filli's thread. Thanks for all great contributions!
https://bitcointalk.org/index.php?topic=5325350.0