Bitcoin is destroying the environment + energy grid to make scammers rich

Something you're misunderstanding is that 90% of new electricity growth last year was done by renewables. Now the Trump admin has declared war on solar and are threatening to shut the entire industry. With AI demand coming around the corner we need more electricity than ever before.

Why should consumers subsidize the crypto mining industry when it provides no benefit to consumers?

People play video games for fun. People mine bitcoin for a business. Your comparison is utterly braindead.

If you want to expand crypto mining in america then you can't go to war with the cheapest electricity which is solar. The entire administration approach is braindead and stupid

 

Well, I think I do understand it since I'm in the industry and look at this stuff every day, but whatever. But the solar industry won't be shutting down. Everything built will still operate. And, there is still a good investment case for solar without federal subsidies in good sites. The only asterisk I'd put is that a lot of parts come from SE Asia and the tariffs might be a problem.

But in any case, what we really need for the growth expected from data centers is a lot more baseload generation. Data centers are high load factor consumers because they run 24/7. Intermittent generation is a sort of price opportunist generation source. It is great for cutting prices when the sun is shining. Which isn't a knock -- that's very important. But it doesn't really add capacity to the system. Or, for it to make a real difference to total capacity, we would need batteries deployed at the same level we have wind and solar deployed.

The reason why so much of new generation last year and for the last decade has been wind and solar is because energy prices have not supported the investment case for other kinds of generation. I can hear the howls of objection already, but power generation companies have not made enough of a profit at wholesale to incent new investment. That is changing now. PJM, the largest wholesale market, is in turmoil right now because their capacity market cleared at its maximum cap. The cap is there to protect consumers from high prices, but the fact that we hit it means there is a strong incentive to build more plants (and/or to lift the cap). We don't have a capacity market in Texas, but wholesale energy prices are elevated enough that many companies have new projects in the works to build gas-fired plants for the first time in a decade.

So yeah, we need more generation but different technologies have different attributes. For data center growth, the attribute we really need is dispatchable baseload generation (and voltage control, but I won't go into that). When we plateau in capacity again, probably the emphasis will switch back to renewables/batteries to cut prices.

That's a wider social question than just how we pay for power. I don't get much benefit out of crypto myself, but it isn't the only industry we power that has no utility for me. I wouldn't mind if the entire tobacco industry disappeared, but we decided it was legal and so they get to buy power like everyone else. And bitcoin does have uses for some people -- criminals hiding their drug empires, billionaires who need to hide their wealth, third world dictators who need an escape plan, and sovereign citizens who refuse to recognize fiat currency.

But, as I argued earlier, other consumers are not subsidizing electricity for the crypto industry. They pay a price -- either regulated by a commission or determined by the free market between for profit businesses -- that reflects the attributes of their participation on the grid.

The hyperscaler data centers are going to be more dangerous for consumer prices than crypto. The miners' business model is essentially an arbitrage on power prices. They are very sensitive to price and it is in their interest to stop when prices are high. They might raise the floor on the lowest prices. But the data centers for Big Tech are going to want near-100% uptime and they are so rich they don't care about the vacillations hour-to-hour in the power price. They won't reduce operations when energy prices spike unless the grid operator cuts them off. Where crypto's gross margin is highly indexed to the power price, it's just a line of OpEx for the data center. And, their pressing concern is "time to power," as in what is the generation they can build the fastest. They will pay a premium to get it fast. Which will mean new plants won't necessarily be the lowest-variable-cost plants, putting upward pressure on price.

 

The greatest wealth storage vehicle ever known is a great benefit to everyone, particularly the poor.

People make and buy games for the same reason people mine and buy Bitcoin, because it adds value to their lives.

The point here is that your opinion about what is "wasteful" is entirely subjective.

Subsidies aside, Bitcoin is the key to a greener and more stable power grid.

 

A ton of energy is wasted just to keep digital money under a digital mattress. Digging up digital holes and then filling them up with digital dirt.

The greatest wealth storage vehicle has less than 2 decades old, a mere blink in human history.

BTC isn’t necessary to help the grid, we could simply legislate it.

 

Creating demand by digging digital holes and filling them with digital dirt seems a very poor use of energy….

Much like how ethanol for energy is a very poor use of top soil, resources and farm land.

 

'analog' money has a massive environmental impact too. But I am sure you will justify why 70,000 brick and mortar banks need to exist.

Have fun staying poor

 

Well people actually use dollars..... Just like there is a huge environmental impact from growing food, those sort of trade offs make sense.

Weird analogy since brick and mortar banks have been closing as dollars went increasingly digital.

Edgy.... definitely doesn't give off an insecure vibe.

 

How does BTC mining bring more baseload electricity on the grid?

 

Yeah of course existing solar projects will continue but adding a extra tax on all new large projects and eliminating residential solar subsidies at a time electricity demand is skyrocketing is moronic? If we want to get rid all subsidies then we shouldn't be adding extra subsidies for coal?

I just came from Pakistan where there has been more solar growth than any ofher country in the world. You have street vendors selling solar panels on the side of the road. Its remarkable how they fixed their blackouts by going all in on solar.

I just dont understand why we're going to war with renewables in the year 2025

 

Has nothing to do with right or wrong, it's markets and incentives.

If I'm an energy producer/supplier, I am far more likely to create/find/harness more sources of energy if I have an assurance that my energy product will have a buyer no matter what. The Bitcoin network, which has a persistent, stable need for power, is that financial incentive. The risk for my enterprise is lowered, so I am more likely and capable of bringing energy products to market. This is particularly important for renewable energy, whose throughput are very unpredictable.

This new incentive allows energy producers to build up far more capacity than past markets would tolerate because they now have a consistent buyer of last resort. This means that during periods of high usage, the energy that otherwise would not have been available can now be bought back from the Bitcoin network to meet those unpredictable surges in demand.

JuanValdez already did a fantastic job explaining all of this to you. Maybe go back and re-read his posts.

 

Wealth storage is 'use'. In fact, I'd argue it's the most important use case there is.

 

@JuanValdez is a smart individual so ill take his word for it but you really need to ask yourself if thats good what hes claiming. If electricty demand is high enough that utlities are building new gas powered plants at at time climate change is the worst then thats not actually healthy or good long term for the world. If we kept the subsidies from the inflation reduction act and incentivized residential solar and scaled up geothermal/wind then I would have no issue with BTC mining. We are adding dirty energy to the grid at a large scale at a time we cant afford it as climate change is getting worst.

Also most of the time these "new plants" are build in poorer/black areas and have negativity affected them than any other demographic. Look at cancer alley in LA and how many black citizens its killed through the years.

The energy secretary has also said they will ensure not a single new wind project goes up in the country while also destroying new transmission lines that were permitted under Biden. We have the most energy incompetent admin in modern history

 

How and where energy is produced is not Bitcoin's problem. Those are the government's problem. If you want to change what energy is used or where it is created, you need to engage with the law.

And if you really care about renewables, you should be the biggest BTC fanboy around, because having the Bitcoin network as the buyer of last resort is the only way such energy is ever going to be market viable at scale.