I hope to have planted the seed for a shift in perspective: that spending energy on proof-of-work is not a waste, but a worthwhile endeavor.
Understanding mining and proof-of-work in more detail might help to convince some of Bitcoin’s critics and shift the perspective from “inefficient and wasteful” to “secure and censorship-resistant”. Pointing out these nuances might also be helpful to understand that Bitcoin’s energy consumption most strongly correlates with the network’s security, and not with the adoption, usage, or utility of bitcoin. Even if the utility of the network and the price of bitcoin continues to increase exponentially, the energy consumption does not necessarily need to follow the same exponential trend. Gaining a better understanding of the Bitcoin network might also help to understand where other solutions fall short.
Satoshi’s genius was to combine a bunch of clever tricks into a new economic game which creates a digital, scarce artifact, without central issuance. This artifact is backed by computation, and computation requires energy.
The current economic game is a game of walls and vaults, closed systems and centralized power. The new economic game is a game of hashes and blocks, public keys and private keys, based on mathematical proofs and physical reality. A game without gatekeepers, without central authorities, without censorship or discrimination.
The old rules have led to a system where money is valuable “because I say so”, leading to magic tricks like fractional reserve banking, inflation to stimulate excessive consumption, and even hyperinflation because the temptation to print ever more money is simply irresistible.
The new rules might not be easy to understand. They might, however, lead to a new financial reality: a new economy based on sound money. We will all have to adapt to these rules and become familiar with the nuances of this new game. And we will have to come to terms with the fact that a finite resource has to be used to secure this new, decentralized economy. In the case of Bitcoin, this resource is energy.