- AIKON CEO, Marc Blinder, discusses the footprint of the Bitcoin (BTC) consensus algorithm with Ripple’s CTO, David Schwartz.
- Bitcoin mining and Proof-of-Work cryptocurrencies are unsustainable and are an obstacle to adoption, says Blinder.
Ripple CTO David Schwartz interviewed AIKON CEO, Marc Blinder. The interview focused on Bitcoin mining, the proof of work and the sustainability of the mining business. In particular, the interview discussed how sustainable blockchains will lead to mass adoption.
During the interview, Blinder was critical of Bitcoin’s consensus algorithm, the Proof-of-Work. According to Blinder, the Bitcoin consensus algorithm is a trade-off between electricity and money, he added:
The thing about proof of work is you’re basically turning electricity into money. The more Bitcoin is worth, the more electricity it requires to operate the system, because there’s a lot more competition. Environmental destruction is built into the system.
Is the Bitcoin blockchain sustainable?
In the publication accompanying the interview, a study on mining by Bitcoin is cited. The study states that BTC mining produces 22 megatons in coal emissions. This is equivalent to the coal emissions produced by Las Vegas and Sri Lanka in one year. In terms of electrical energy, the study concludes that Bitcoin mining needs about 45.8 TWh.
Along these lines, a report cited by Ripple CEO Brad Garlinghouse pointed out that Bitcoin and Ethereum networks consume a high amount of energy and have a negative impact on the environment. In the report, Bitcoin’s energy consumption is compared to that of Chile. In this report, it almost doubles the previous figure and states that Bitcoin’s annual energy consumption is 77.78 TWh.
In that sense, AIKON’s CEO believes that Bitcoin mining is an obstacle to the adoption of digital assets, as it is a constant source of energy consumption. In opposition, it is claimed that the carbon footprint of XRP is 10 million times smaller than that of Bitcoin. Blinder further outlines that adoption, in addition to being an issue of energy efficiency, must be related to the user experience:
The problems with mass adoption are actually on the front-end user experience level. A quality experience for the average person will make the biggest impact. We need very efficient systems if we want to use blockchain for [a range of]different use cases in the future.
Reports and research criticizing Bitcoin mining have been questioned. Many of these reports do not take into account the type of energy that Bitcoin uses, nor do they distinguish between the different types of mining equipment used to mine BTC. Critics usually ignore that BTC mining only accounts for 0.35% of total global energy consumption.
However, Blinder’s interview ends on an optimistic note. Highlighting the importance of educating people to take control of their money, AIKON’s CEO said:
Blockchain levels the playing field [for]people all over the world. I think public blockchains will win in the end because they’re better for small businesses…and for individual people.
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