, 15 tweets, 8 min read Read on Twitter
1/ Last week @CoinSharesCo released our latest report on #bitcoin mining along with a follow-up Medium post detailing some of the economic concepts that drive this industry. As promised, here's part two of my follow up - this post re: bitcoin's energy mix: medium.com/coinshares/bew…
2/ Now that the "death spiral" argument has been thoroughly debunked by @arjunblj, @nic__carter, @matt_odell, @danheld and others (👉 medium.com/coinshares/an-…), I want to focus on the second body of our findings: those around bitcoin's energy use and the sources that power it.
3/ While I am a bit hesitant to even engage with those opposed to the inviolability of liberty and the free market () because we just fundamentally disagree, I still have a few things to say on this matter.
4/ First, I reject the idea that moral imperatives have any place in economics. If you want to reduce carbon pollution, make it expensive and let the free market sort it out. The idea that some electricity use is "better" than others is patently absurd. Christmas lights anyone?🎄
5/ But here's where it gets better: *even if* moralistic economics was *not* a spurious endeavour (@saifedean), the anti-bitcoin environmentalist narrative still fails based on two inconvenient facts:
6/ (1) #Bitcoin mining is mainly driven by #renewable energy, predominantly hydro; and (2) Much - if not most - of this hydro power would literally be wasted if it weren't used for bitcoin mining. That's right - it would simply flow over dams, doing no useful work whatsoever.
7/ Renewables represent a 77.8% penetration in the #bitcoin mining energy mix. That compares to the 18.2% penetration in the global energy mix.

By inference, this makes Bitcoin "cleaner" than almost every other industry.
8/ And then there's this: the combined global power draw of PS4, Xbox One and Wii U units running four hours a day (4.9 GW) is higher than that of the entire #bitcoin mining network (4.7 GW). 🚨 woop woop 🚨 @danheld
9/ This should put the displacement argument to rest: according to @Reuters, in Yunnan and Sichuan *alone*, many multiples of the total annualised power draw of the entire #bitcoin mining network is simply wasted every year.

@BitMEXResearch hinted towards this a while back.
10/ Not only does #bitcoin cause no more significant harm to the environment beyond that of literally every other application of electricity - it actually has the potential to act as a positive catalyst in the development of renewable energy.
11/ The unique properties of #bitcoin mining allow miners to bootstrap renewables projects in the lowest cost areas even if these projects are unconnected to regional grids.
12/ Because #bitcoin mining is incredibly mobile compared to its power demand, and running fiber is a lot cheaper than building a HV grid, #renewables projects - even if remote - can attract cornerstone clients immediately.
13/ #bitcoin mining can thus render previously uneconomical #renewables projects economical. Profitability on the back of mining leads to higher reinvestment rates and greater scale. Greater scale eventually makes grid connections economical. @danheld @Nic__Carter
14/ As soon as grids are constructed, the market is likely to bid up prices to the levels of the regional norm, which in turn is likely to price miners out. Miners are then forced onto whatever next project can offer the lowest renewables prices.

Wash, rinse, repeat.
15/ So let's please lay the environmentalist FUD to rest. Carbon pollution is a real problem, but #bitcoin, christmas lights or gaming consoles are not appropriate aveues to approach that problem.

Carts don't pull horses 🐴
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