Bitcoin drama everywhere

The grandaddy of cryptocurrencies has hit turbulence on multiple fronts lately. But will it last?

Photo by Ivan Radic via Flickr under Creative Commons 2.0 license

Re-sharing below the latest edition of #Web3 Weekly, my regular newsletter about decentralization. If you’d like to get it in your inbox every Sunday, subscribe here.

Let’s talk Bitcoin a minute. I usually try to be more ecumenical around here about covering different technologies, but Bitcoin in particular has so dominated the news lately, and it is so important to decentralization in general, a deeper dive seems in order.

As ever, full disclosure: I do own some BTC, and everything below is presented for informational purposes only, not as financial advice. If you crave the latter, please DYOR.

Also, a quick style note for grammar and usage sticklers: “Bitcoin,” with a capital b, is generally used to refer to the Bitcoin network and the growing ecosystem of businesses built upon it. Lowercase-b “bitcoin” is more appropriate for specific references to the network’s flagship token, as in stories about swings in its price. (In crypto world, this verbal distinction is also neatly illustrated by the capital-e Ethereum network and its lowercase-e token, ether.)

You’ll notice I also sometimes use ticker symbols like BTC or ETH as shorthand to refer strictly to the tokens. That’s just a tic left over from too many years covering the stock market. 🙃

OK. On to the latest Bitcoin-centric news:

  • How green (or not) is Bitcoin? An excellent piece by New York Magazine’s Jen Wieczner delved into this question, which has been at the heart of BTC’s recent price weakness. As environment-focused criticism has mounted, heavy selling has followed. Wieczner points out that, yes, the Bitcoin network is undeniably power hungry, consuming about as much electricity as all of Switzerland. But there are also some less-discussed pros as well. Much of BTC miners’ power is generated from renewable sources. Also, high power costs and rising long-term prices for BTC could create powerful market incentives for adoption of green technology in the future — a dynamic environmentalists have sometimes struggled to create by other means. That is to say, in many industries, it is still often more expensive to switch to “green” practices versus the status quo. Not so for Bitcoin miners. Separately, podcaster Laura Shin did a must-listen episode on the relative environmental impact of Bitcoin versus the U.S. dollar. Her guests discussed how USD’s value been closely tied to the global energy trade since the 1970s, effectively incentivizing more fossil fuel consumption by default.

That’s it for now. Thanks for spending some time with the newsletter today! A full revision history of it, including earlier drafts, is available here if you’re interested. If you’d like to get updates like this in your inbox every Sunday, please join our email list here.

Consultant and writer focused on Web 3.0. Former award-winning reporter for WSJ, Washington Post, and Vice. Sometime founder and product manager as well.