Ask Doctor Bitcoin: Is crypto destroying the planet? [Free, #8]

We look at one of the key pillars of the case against the 'greenness' of crypto today, and how much of the media's interpretation is fundamentally flawed.

This week, rather than one large deep dive, I wanted to go into a few different topics while I button up some of the other deeper analysis pieces I’m working on.

One of these topics definitely falls into that category of topics of “things that never seem to die no matter how many time they’re addressed,” always a good time: “Is bitcoin/crypto/blockchain destroying the planet?”

It’s a question that started rearing it’s ugly head a couple of bull cycles ago, when crypto began seeping into the mainstream. It mainly exists because it relies on the type of junk science you tend to see in other big lobby controlled industries like oil and gas or tobacco: When there’s lots of money to prop up “science” on a commonly misunderstood issue, it’ll always find some willing shills with degrees and flagging grants to fund.

The answer is, of course, no. We’ll explore in part why that is in today’s missive. This photo was shot on the beaches of Santa Monica, sometimes known as “Blockchain Beach.”

There are many ways big banking funded studies have found to attack the “greenness” of cryptocurrency, and today’s newsletter won’t be an exhaustive look, but we will look at one of the primary pillars of that research and how it’s completely off base.

Also, since “alt-season” is without a doubt kicking off this week, we’ll take a look at some advice from a bitcoin maximalist, and try to put it into a lense of sensibility and a the concept we discussed last week: cypherpunk maximalism.

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Blockchain Bulletin

  • Second Turkish cryptocurrency exchange, Vebitcoin, collapses amid crackdown. The cryptocurrency exchange Vebitcoin went offline days after Theodex closed amid a crackdown on the crypto industry in Turkey.

  • Gemini launching new crypto-rewards credit card. Bitcoin exchange Gemini partnered with Mastercard to launch a new credit card that will provide cryptocurrency rewards this summer.

  • Coinbase links up with PayPal for crypto buys. Customers in the U.S. can now fund their Coinbase balances from PayPal and cash withdrawals are available for the U.S., Canada, E.U., and U.K.

Blockchain Behind the Scenes

  • U.S. authorities arrest alleged mastermind behind Bitcoin Fog. The U.S. Department of Justice announced that it has arrested and charged the alleged operator of Bitcoin Fog, the longest-running bitcoin “mixer” site.

  • Tesla reveals $101M bitcoin profit in first quarter crypto investment. Tesla says it cashed out $272 million in bitcoin in the first quarter of 2021 and made $101 million in profits from its sale to prove that crypto assets can be an investment.

  • Lobus raises $6 million for blockchain art management platform. With much attention aimed at digital art, Lobus seeks to provide non-fungible token blockchain technology marketplaces for physical artwork as well and allow artists to maintain fractional ownership through and tracability through sales as well.

Blockchain Deep Dive(s!)

  • Bitcoin, Evils of Capitalism, and Energy Usage. I was confronted and then ditched by a professional peer of mine via twitter for having “wholeheartedly embraced the evils of capitalism” for daring to counter some of the common myths around bitcoin energy consumption. This mini-piece doesn’t holistically address this issue, but it does address a commonly believed myth that is central to the greens’ narrative against cryptocurrency.

  • Most media coverage, including Maher’s, rests on debunked research that pins it’s claims on each transaction having a knowable carbon footprint.

  • Bitcoin and Ethereum both have static throughput in terms of their transactions per second.

  • ETH is somewhere around 20 TPS.

  • BTC is somewhere around 7-11 TPS (this may be slightly improved by the upcoming Taproot upgrade).

  • This does not change with more or less miners on the network.

  • This does not change if the price goes up or down.

  • If you mint and NFT or transact BTC, the networks will use the same amount of power as if you didn’t.

  • Jimmy Song, Bitcoin Maximalist, on “Altcoin Season.” Jimmy is a noted Bitcoin maximalist and trading advisor. In his most recent newsletter Monday, he came out swinging on altcoins: “Altcoins have given up even trying to give technical justifications [… having] evolved to be pure marketing.

  • “Alt Season” is definitely here. On Tuesday, Bitcoin dipped 4% while ETH lead much of the alts in rising 3% during the same time period (including Doge, which is up 40% on the day).

  • Alt season is traditionally defined as when capital and gains traverses Bitcoin into other “diversified” cryptocurrency options.

  • Jimmy notices that no other serious offerings are trying to “be bitcoin,” ceding the “store of value” narrative to the king.

  • Jimmy also notes that most new offerings are sizzle with no steak.

  • This isn’t an entirely new phenomenon, but I do concur with the trend he spots that most new offerings have stopped trying to appeal as much to the alpha geeks and cypherpunks.

  • I surmise that this may be more because cypherpunk culture has been largely supplanted by “bitcoin maximalism,” which is an orthodoxy that turns off many newbies.

Technical Analysis: Focus on Ethereum
By Virtual Bacon DAO’s Dennis Liu

  • ETH just hit $3k this week.

  • The outlook is still good long term.

  • Buying the after a pump is never a good short or medium term strategy.

  • If you’re looking at ETH as a trader, look elsewhere this week.

  • If you’re looking at ETH as an investor, keep on with it.