Bitcoin is digital gold. Gold has retained its value for millennia because of its scarcity and intensive capital and energy expenditure needed to pull it from the earth. The energy expended to acquire this shiny metal is directly linked with its value. They say gold is a store of value. I would argue that gold is a store of energy- which gives it value. The capital and energy expenditure to mine bitcoin is immense. Therefore, just like gold, I believe the energy stored in each bitcoin created will give it great value.
The US dollar was backed by gold in the 1830's. This gave the US dollar real value because it was backed by the energy required to mine the gold. In 1971 the US moved away from the gold standard. There was now zero energy backing the dollar, and the stability of the dollar flailed. It was not until OPEC started pricing barrels of crude oil in US dollars that stability was found. It was now synonymous with oil - a form of energy. Oil is a commodity sought after by all nations but only regionally available around the world. The scarcity of oil and the energy required to extract and refine it as well as the real world utility of what you can produce with it gives oil unprecedented value. Solar on the other hand is universally available. Investments by nations are likely to allow them to harness energy in their backyard and become less reliant on imported energy. Electrification of cars and manufacturing around the world are happening at a rapid pace. What happens to the US dollar if oil becomes and energy of the past?
Renewable energy is the energy of the future. Renewable energy is the most efficient to harness, refine, store and transport; therefore, the cheapest. Bitcoin mining will be a driving force towards renewables in the US and abroad as a result of competition. Corporations competing for the cheapest electricity. The new breed of Americans focused on green energy will drive progress at a much faster pace than ever before. Currently renewables account for 39% of power generation on the bitcoin network while only 11% of energy for general energy use is produced by renewables. Renewables are the energy of the future. Bitcoin is directly linked to the energy of the future. Energy is value.
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