Over the 12 years of its existence, Bitcoin has garnered praise and tremendous enthusiasm. It has also attracted a great deal of criticism and disdain. From economists and bankers to policy makers, those entrenched within the financial industry have disapproved of this cryptocurrency. Depicting it as a Ponzi scheme and “too volatile to be a store of value,” they have expressed their wish for Bitcoin to go away.
The latest criticism centers around Bitcoin’s high-energy consumption, i.e., the significant amount of electricity miners use to secure the ledger. Mainstream media is pushing the idea of “wasteful” mining, positioning Bitcoin as an agent of environmental pollution. Yet this is based on a misconception. A comprehensive analysis of carbon emissions created within the financial sector shows that Bitcoin mining has a far smaller harmful environmental impact than the impact of energy use within the legacy banking system.
The FUD (Fear, Uncertainty, Doubt) fostered by the media around the environmental “purity” of Bitcoin mining was recently amplified when Elon Musk, the CEO of Tesla, despite having embraced Bitcoin, recently made a 180-degree turn. In a May 12, 2021 tweet criticizing Bitcoin’s environmental impact, he backtracked on his earlier decision to accept Bitcoin for payment for his company’s vehicles. He then announced that he had met with leading North American miners to form the Bitcoin Mining Council, which would promote energy usage transparency to facilitate sustainability initiatives worldwide.
This billionaire’s dramatic move — along with his subsequent breakup meme tweet — caused a sharp decline in the bitcoin price. What is perceived as Musk’s social media attack on Bitcoin came about in today’s media narrative, converging Covid with climate change issues and in the decline of the fiat system with hyperinflation. Now, Bitcoin’s competition with the status quo heats up.
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